A Unified Approach to Measuring the Costs of Violent Crime Risk

Lead Research Organisation: University of Southampton
Department Name: Sch of Economic, Social & Political Sci


Overall crime rates in the UK have been steadily declining since the mid 1990s. In the past few years, however, the incidence of violent crime, and in particular murder, began to rise. Between July 2017 and June 2018 the number of homicides went from 630 to 719, a 14% increase - and a fourth year of consecutive rise - in the number of homicides. Against the backdrop of rising homicide counts, since 2010, police officer strength has declined by over 20,000 (full-time equivalent) officers - a drop of around 15%. Such a decline in police resources effectively underscores the importance of understanding the social costs of violent crime, in that such an understanding will better aid the allocation of these increasingly scarce resources.

The primary aim of the project is to use a previously unexploited combination of existing crime data and survey/administrative data, supplemented with newly available house price data from Zoopla, to answer the following questions:

1.) How much does a recent murder affect house prices in the neighbourhood? Using well-established economic models, we will estimate households' willingness to pay to avoid violent crime risk. This is our key approach to measuring the financial cost of a recent, local murder.

2.) Are individuals' life satisfaction and perceptions of crime risk adversely affected by an unexpected violent crime event in the local area? Widening the scope of our research to incorporate these subjective measures enables us to provide a more comprehensive assessment of the societal costs of violent crime incidence.

3.) To what extent are subjective outcomes the mechanism at play behind house price changes? This final question is one of the key innovations of our unified approach, and is also the area where we effectively leverage the richness of the data that we combine. With the spatio-temporal detail of our data, we are able to discern the causal pathways of the key variables at play, and to understand to what extent changes in subjective well-being outcomes map into changes in house prices, and thus willingness to pay to avoid violent crime risk. This is crucial to both shed light on the complexities of the behavioural response of individuals to criminal events and to improve the design of policies that cope with the effects of crime.

Our methodological approach is innovative in several dimensions. First, we merge existing data sources in an original way to create datasets with a unique combination of spatial and temporal detail. In particular, we merge murder statistics with two sources house price data and three different sources of survey data by contemporaneously exploiting the place (postcode) and time (day) of the crime event. This distinctive data combination enables us to use advanced econometric techniques, and a novel set of empirical strategies, to identify the causal impact of crime on a series of policy relevant outcomes. Second, focusing on murders - aside from being novel and timely - allows us to consider a type of crime that is unpredictable (within a locality) but at the same time perceptible. These characteristics help to circumvent fundamental methodological problems related to both the measurement of crime and the role of unobservable confounding factors, ultimately allowing us to produce compelling, credible estimates of the causal impact of crime. These estimates will be of interest to both academics and to policy makers.

Obtaining a clean, causal estimate of the societal costs violent crime risk will be of use to the Ministry of Justice (MoJ) in their role of assessing the costs of crime. Our work will also be of interest to health economists at the Department of Health and Social Care (DHSC) and researchers at the Ministry of Housing, Communities & Local Government (MHCLG) in that we consider both a broad set of psychological costs of a recent violent crime, and how such costs are experienced by those within the local community.

Planned Impact

Who will benefit from this research and how?
1. Who: Academic social scientists with interests in crime. These include economists, sociologists, psychologists, demographers, geographers and social policy analysts.
How: By simultaneously analysing objective and subjective effects of crime, we expect that our unified approach will be beneficial to bring researchers from these disciplines into closer contact and to encourage inter-disciplinary research. Our research will push theoretical foundations and empirical methodologies for measuring the cost of crime. In doing so, we endeavour to shed light on key questions that are relevant to all academic disciplines with an interest in crime. For example, we will be able to assess how the impact of crime on mental health diffuses in the local area, shedding light on the spatial nature of well-being, something of immediate interest to psychologists and geographers. By studying the causal effect of murders on the housing market, we will be able to provide estimates of the impact of crime on residential displacement, which would benefit research by demographers and sociologists.

2. Who: Policy analysts in government, including health economists at the Department of Health and Social Care (DHSC) and researchers at the Ministry of Justice (MoJ) and at the Ministry of Housing, Communities & Local Government (MHCLG).
How: By studying the impact of crime on dimensions such as housing and mental well-being, our research will produce empirical evidence on key areas of policy making. In particular, our project will be beneficial to the DHSC, as it will provide both a method to measure the impact of crime that is complementary to their current approach and additional empirical evidence to support the development of health policies. We have involved DHSC from the early stage of this proposal and they have been instrumental in recommending specific well-being outcomes to focus on (ranging from mental stress to workplace absenteeism) and that are relevant for their policy agenda. DHSC has informally agreed to participate in the policy impact workshop - the key dissemination event for the project. We foresee also the participation from additional government departments (including MoJ and MHCLG) as well as researchers and practitioners from local governments. The policy event will also be a platform to establish new connections with policy makers and practitioners, therefore ensuring that the impact of our research will extend beyond the project lifetime.

3. Who: Third sector organisations with an interest in helping people affected by crime, such as Victim Support and Crime Concern.
How: Our research will provide a broader perspective about the cost of crime, encompassing both material and immaterial dimensions and recognising that the traumatic consequences of violent crime could involve many individuals in the affected neighbourhood. Our empirical findings could be used by these organisations to better target individuals affected by crime and to improve the design and provision of services, ranging from more generic emotional support to specific programmes such as the National Homicide Service (a service delivered by Victim Support and funded by MoJ).

4. Who: Academics who would like to use the datasets to replicate or extend analyses about the cost of crime.
How: Our research will produce scientific use files and technical material that will be stored at the UK Data Service for the benefit of the research community. We will provide detailed instructions and computer codes on how to obtain the datasets derived from the project and link them to reproduce the datasets we use in our analyses. Our unique blend of data will allow to study the effect of crime on a wide range of outcomes, beyond those considered in this research.


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Description - New knowledge has been created in researching the question ""How does violent crime affect house prices in the neighbourhood?". This has been studied in the context of the violent crime generated by the welfare cuts imposed by the UK Welfare Reform Act 2012. In particular we discovered that:
o there are substantial negative consequences of fiscal austerity programme on crime -- particularly violent crime.
o the increases in crime occur both in terms of intensity (higher crime rates) and in terms of spatial concentration.
o more deprived areas experiences largest increase in crime. Crime increase lead to a large societal cost as measured by a fall in local house prices.
o the implied welfare loss associated with the Welfare Reform Act 2012 is £92.8bn, which far exceeds the savings generated by the welfare reform.

- When studying the spatio-temporal process of crime diffusion, new questions opened. In particular the question on "What are the neighbourhoods that have the largest crime spillovers (i.e., network effects) on other neighbourhoods"? emerged as key to improve our understanding on crime patterns. We use London as case study. In this context we discovered that:
o Crime across neighbourhoods is spatially correlated, with the magnitude of such correlation being strong in the case of property crime and weak in the case of violent crime
o Not all areas that have highest crime rates are also the most important ones in diffusing crime to other neighbourhoods. This has strong implications for crime prevention

- We have established new research networks as part of our research. In particular, we created links with more than 15 Police Force Authorities to discuss our research. This led to:
o learn about PFAs' practical aspects of implementing strategies for reduction of crime (particularly "hot spot policing"), which ultimately were important to inform and adapt our econometric models used in the estimation of the spatio-temporal diffusion of crime
o initiate process for access of restricted-use crime data
o set the seeds for potential future research collaborations

- We have created new research capability and specialist skills.
o The organization of the Summer School on The Economics of Crime over Time and Space develop was instrumental in sharing knowledge of the methods developed in the project and through this developing the research capacity of doctoral students and early career researchers who participated to the event.
o The project was also functional in developing the methodological and analytical skills of the postdoctoral fellow and of the PhD student who participated in the research activities.
Exploitation Route The findings and data of this project are important to improve our understanding on the impact of crime, its monetary and non-monetary effects, and its process of spatial diffusion. More specifically, the findings on the crime and social welfare consequences of the welfare cuts can be used to inform future governments of the indirect effects of large welfare cuts. The findings on the extent to which spatial networks propagate the spatial diffusion of crime may be used by police forces to inform improved targeting of areas (e.g., hotspot policing) when resources are limited. The findings will be disseminated further via future publications to provide better evidence for policymakers interested in crime. The availability of scientific use files to replicate the construction of the dataset will allow exploring additional research questions in the future.
Sectors Communities and Social Services/Policy


Democracy and Justice


URL https://arxiv.org/abs/2012.08133
Description Stakeholder Engagment Meetings 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Professional Practitioners
Results and Impact As part of the implementation of our impact strategy, we have engaged with key stakeholders involved in the prevention and deterrence of crime.

We contacted the police and crime commissioners and the chief constables of all 43 Police Force Areas (PFAs) in England and Wales, the Police Service of Northern Ireland, and Police Scotland.

As of November 2022, we have met with or plan to meet with 17 PFAs. In our dissemination meetings, we presented the activities developed in our project, particularly our ongoing results of the paper that aims to improve upon the standard hotspot policy approach by incorporating information about the spatial diffusion of local crime. Presenting the case study of London, we were able to disseminate the key and original discoveries of our research, particularly what we learned around the spatial diffusion of different types of crime within a network framework.
In this phase, we were able to collect feedback from PFAs about the particularities of crime patterns in their areas, which was helpful to tailor our approach to flexibly adapt to different PFAs settings.

The engagement activities with PFAs enable us to construct a network with key stakeholders through which we will be able to disseminate future results from the project beyond the project's lifetime and potentially start future research collaborations to expand knowledge on the spatial impact of crime.
Year(s) Of Engagement Activity 2022
Description The Economics Crime over Time and Space Summer School 2022: Theory, Practice and Applications 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Postgraduate students
Results and Impact On 21 and 22 of September 2022, we hosted a summer school on "The Economics Crime over Time and Space: Theory, Practice and Applications". This initiative was one of the milestones of the project, aimed at disseminating theoretical and empirical tools developed during the project's lifetime.

The summer school attracted students from top universities in the UK (including from UCL, Warwick and QMUL) and further afield (e.g. from University of British Columbia, Norwegian School of Economics, Georgetown University, National University of Singapore, Gothenburg University, UC3M and Rice University).

Jo Swaffield, the Dean of the Faculty of Social Sciences at the University of Southampton gave an introductory speech; the summer school programme included a mixture of lectures and coding sessions taught by the project team (Arpita Ghosh, Corrado Giulietti, Brendon McConnell), two keynote lectures - one by Yves Zenou (Monash, Southampton), and another by Pedro Souza (QMUL) and a series of lightning presentations by 15 of the participants. Additional Southampton faculty attended these presentations in order to provide feedback to the participants. At the end of the first day we organised a networking event on gather.town. According to a survey of participants that we administered after the event, the majority of participants found the sessions and the structure of the programme very useful. Networking with early career researchers was a natural outcome of this event, which helped setting the bases for potential future interactions revolving around the academic and policy outputs of our project.

The programme for the event can be found at: http://brendonmcconnell.github.io/pdf/ECTS22_Summer_School_Programme.pdf
For posterity we have hosted all presentations at https://github.com/AG-Econ/EconofCrimeoverTimeSpace
Year(s) Of Engagement Activity 2022
URL http://brendonmcconnell.github.io/pdf/ECTS22_Summer_School_Programme.pdf