Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/63089 
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dc.contributor.authorMehlum, Halvoren
dc.contributor.authorMoene, Karl Oveen
dc.contributor.authorTorvik, Ragnaren
dc.date.accessioned2012-09-20T13:14:34Z-
dc.date.available2012-09-20T13:14:34Z-
dc.date.issued1999-
dc.identifier.urihttp://hdl.handle.net/10419/63089-
dc.description.abstractA dynamic macroeconomic model is used to analyze the interaction between economic growth, labor demand and crime. Due to endogenous crime, the model exhibits increasing returns to aggregate capital at certain development levels. At other development levels, however, there are decreasing returns to aggregate capital. The linkages determining the outcome work via aggregate labor demand and aggregate production. Hence, the increasing (or decreasing) return is external to the individual firm. The economy has potentially two stable equilibria: a) One where crime rates are high and capital stock, labor demand, and income is low. b) One where crime rates are low and capital stock, labor demand, and income is high. Equilibrium a) has the characteristics of a poverty trap. The existence of a poverty trap has important implications for the implementation of economic reforms. We show that a big bang reform, intended to improve efficiency, may throw the economy into a vicious circle of increasing crime and stagnation.en
dc.language.isoengen
dc.publisher|aUniversity of Oslo, Department of Economics |cOsloen
dc.relation.ispartofseries|aMemorandum |x1999,35en
dc.subject.ddc330en
dc.subject.stwKriminalitäten
dc.subject.stwArbeitsangeboten
dc.subject.stwWirtschaftswachstumen
dc.subject.stwKriminalitätsökonomiken
dc.subject.stwTheorieen
dc.titleCrime induced poverty traps-
dc.typeWorking Paperen
dc.identifier.ppn323425534en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen

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