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Does Globalisation Affect Crime? Theory and Evidence
Author(s) -
Ghosh Arghya,
Robertson Peter E.,
Robitaille MarieClaire
Publication year - 2016
Publication title -
the world economy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.594
H-Index - 68
eISSN - 1467-9701
pISSN - 0378-5920
DOI - 10.1111/twec.12422
Subject(s) - economics , openness to experience , globalization , international economics , liberalization , coercion (linguistics) , expropriation , affect (linguistics) , capital (architecture) , sign (mathematics) , monetary economics , market economy , history , psychology , social psychology , mathematical analysis , linguistics , philosophy , mathematics , archaeology
Globalisation sceptics argue that trade liberalisation has high social costs, including an increase in expropriative behaviour such as civil conflict, coercion of labour and crime. We show that a theoretical relationship between trade and expropriation exists, but the sign differs for developed and developing economies. We verify this empirically using data on crime rates. Specifically, we find that trade liberalisation, as measured by both higher openness and lower import duty rates, tends to increase burglaries and theft in very labour‐abundant countries. For other countries, however, we find that trade liberalisation has either a small negative effect on crime or no effect, depending on the country's capital abundance.