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w18815[1]THE EFFECT OF POLICE ON CRIME: NEW EVIDENCE FROM U.S. CITIES, 1960-2010

w18815[1]THE EFFECT OF POLICE ON CRIME: NEW EVIDENCE FROM U.S. CITIES, 1960-2010

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THE EFFECT OF POLICE ON CRIME:
NEW EVIDENCE FROM U.S. CITIES, 1960-2010
THE EFFECT OF POLICE ON CRIME:
NEW EVIDENCE FROM U.S. CITIES, 1960-2010

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NBER WORKING PAPER SERIESTHE EFFECT OF POLICE ON CRIME:NEW EVIDENCE FROM U.S. CITIES, 1960-2010Aaron ChalfinJustin McCraryWorking Paper 18815http://www.nber.org/papers/w18815NATIONAL BUREAU OF ECONOMIC RESEARCH1050 Massachusetts AvenueCambridge, MA 02138February 2013
For helpful comments and suggestions, we thank Orley Ashenfelter, Emily Bruce, David Card, Raj
Chetty, Bob Cooter, John DiNardo, John Eck, Hans Johnson, Louis Kaplow, Mark Kleiman, TomislavKovandzic, Prasad Krishnamurthy, Thomas Lemieux, John MacDonald, Je˙Miron, Denis Nekipelov,
Alex Piquero, Jim Powell, Kevin Quinn, Steve Raphael, Jesse Rothstein, Daniel Richman, Seth Sanders,
David Sklansky, Kathy Spier, Eric Talley, John Zedlewski, and Frank Zimring, but particularly Aaron
Edlin, who discovered a mistake in a preliminary draft, and Emily Owens and Gary Solon, who both
read a later draft particularly closely and provided incisive criticisms. We also thank seminar participants
from the University of British Columbia, the University of Oregon, the University of California, Berkeley,Harvard University, Brown University, the University of Rochester, the Public Policy Institute of California,
the NBER Summer Institute, the University of Texas at Dallas, the University of Cincinnati and the
University of South Florida. The views expressed herein are those of the authors and do not necessarily
reflect the views of the National Bureau of Economic Research.
At least one co-author has disclosed a financial relationship of potential relevance for this research.
Further information is available online at http://www.nber.org/papers/w18815.ack 
NBER working papers are circulated for discussion and comment purposes. They have not been peer-
reviewed or been subject to the review by the NBER Board of Directors that accompanies official
NBER publications.
© 2013 by Aaron Chalfin and Justin McCrary. All rights reserved. Short sections of text, not to exceed
two paragraphs, may be quoted without explicit permission provided that full credit, including © notice,
is given to the source.
 
The Effect of Police on Crime: New Evidence from U.S. Cities, 1960-2010Aaron Chalfin and Justin McCraryNBER Working Paper No. 18815February 2013JEL No. H76,J18,K42
ABSTRACT
We argue that the key impediment to accurate measurement of the effect of police on crime is not
necessarily simultaneity bias, but bias due to mismeasurement of police. Using a new panel data set
on crime in medium to large U.S. cities over 1960- 2010, we obtain measurement error corrected estimates
of the police elasticity of the cost-weighted sum of crimes of roughly -0.5. The estimates confirm a
controversial finding from the previous literature that police reduce violent crime more so than property
crime.Aaron ChalfinGoldman School of Public Policy2607 Hearst AveUniversity of California, BerkeleyBerkeley, CA 94720achalfin@berkeley.eduJustin McCrarySchool of LawUniversity of California, Berkeley586 Simon HallBerkeley, CA 94720-7200and NBER jmccrary@law.berkeley.edu
 
I. Introduction
One of the most intuitive predictions of deterrence theory is that an increase in a typical offender’s chance
of being caught decreases crime. This prediction is a core part of Becker’s (1968) account of deterrence theoryand is also present in historical articulations of deterrence theory, such as Beccaria (1764) and Bentham (1789).The prediction is no less important in more recent treatments, such as the models discussed in Lochner (2004),
Burdett, Lagos and Wright (2004), and Lee and McCrary (2009), among others.
1
On the empirical side, one of the larger literatures in crime focuses on the effect of police on crime, where
police are viewed as a primary factor influencing the chance of apprehension facing a potential offender.
2
This literature is ably summarized by Cameron (1988), Nagin (1998), Eck and Maguire (2000), Skogan and
Frydl (2004), and Levitt and Miles (2006), all of whom provide extensive references.
Papers in this literature employ a wide variety of econometric approaches. Early empirical papers such as
Ehrlich (1972) and Wilson and Boland (1978) focused on the cross-sectional association between police and crime.More recently, concern over the potential endogeneity of policing levels has led to a predominance of papers usingpanel data techniques such as first-differencing and, more recently, quasi-experimental techniques such as instru-mental variables (IV) and differences-in-differences. Prominent panel data papers include Cornwell and Trumbull(1994), Marvell and Moody (1996), Witt, Clarke and Fielding (1999), Fajnzylber, Lederman and Loayza (2002),
and Baltagi (2006). Some of the leading examples of quasi-experimental papers are Levitt (1997), Di Tella
and Schargrodsky (2004), Klick and Tabarrok (2005), Evans and Owens (2007), and Machin and Marie (2011).
Despite their extraordinary creativity, the quasi-experimental approaches pursued in the literature aretypically limited in terms of their inferences by difficulties with precision. For example, a typical findingfrom this literature is that the police elasticity is larger in magnitude for violent crime than for property
crime. This finding is often viewed skeptically however, as there is a common belief that violent crimes such
as murder or rape are more apt to be crimes of passion than property crimes such as motor vehicle theft.
However, the standard errors on the violent and property crime estimates from the previous literature have
been large enough that it is unclear whether the difference in the point estimates is distinguishable from
zero. Indeed, for many of the papers in the literature, estimated police elasticities for specific crimes are only
1
Polinsky and Shavell (2000) provide a review of the theoretical deterrence literature that emerged since Becker (1968), with
a particular focus on the normative implications of the theory for the organization of law enforcement strategies.
2
A related literature considers the efficacy of adoption of “best practices” in policing. Declines incrime have been linked to the adoption of “hot spots” policing (Sherman and Rogan 1995, Sherman and
Weisburd 1995, Braga 2001, Braga 2005, Weisburd 2005, Braga and Bond 2008, Berk and MacDonald 2010), “problem-oriented”policing (Braga, Weisburd, Waring, Mazerolle, Spelman and Gajewski 1999, Braga, Kennedy, Waring and Piehl 2001, Weisburd,Telep, Hinckle and Eck 2010) and a variety of similarly proactive approaches. In this paper, we address the effect of additionalmanpower, under the assumption that police departments operate according to “business-as-usual” practices. As a result, the
estimates we report are likely an underestimate with respect to what is possible if additional officers are hired and utilized optimally.
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