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Abstract

This study investigates whether crime in Poland is governed by economic rationality. An economic model of rational behavior claims that the propensity to commit criminal activi-ties is negatively related to deterrence. The potential presence of higher risk profiles for certain population segments is investigated. Panel data aggregated to sub-regional levels and observed annually for the years 2003 to 2005 are applied. Controls for endogeneity among criminal activity level and deterrence, intra-regional correlation, inter-temporal heterogeneity and spatial spillover are implemented. A negative effect of deterrence on criminal activity is found, confirming the hypothesised economic rationality. Thus, local initiatives aiming to im-prove deterrence rates indeed pay off. Furthermore, certain population segments are identi-fied as obvious target groups for regional policy initiatives aiming to reduce criminal activi-ties. These are, in particular, the unemployed, youngsters and inhabitants in large urban areas. On the other hand, those with lower educational attainment, lower-wage earners and males are less obvious target groups. Finally, spatial spillover patters related to criminal activities seem to be less relevant, thus implying that initiatives toward criminal activities may well be formed at the regional level and that coordination across regions is less called for.

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