INEQUALITY, WELFARE STATE,

AND HOMICIDE:
FURTHER SUPPORT FOR THE
INSTITUTIONAL ANOMIE THEORY*
JUKKA SAVOLAINEN
New York City Criminal Justice Agency

Building directly on key insights from two prior tests of the institu-
tional anomie theory, we predict that the positive effect of economic
inequality on the level of lethal violence is limited to nations character-
ized by relatively weak collective institutions of social protection. This
hypothesis is tested with two complementary cross-national data sets.
Both settings reveal a negative interaction effect between economic ine-
quality and the strength of the welfare state. Nations that protect their
citizens from the vicissitudes of market forces appear to be immune to
the homicidal effects of economic inequality. This finding provides crit-
ical support for the institutional anomie theory.

The anomie theoretical tradition of sociological criminology appears to

be particularly vibrant in two distinct research programs operating at dif-
ferent levels of explanation. The general strain theory pursues the tradi-
tion at the individual level of analysis, whereas the institutional anomie
theory is in the process of reforming the macrolevel elements of Merton’s
legacy. Formulated by Robert Agnew in 1992, the general strain theory
has generated several empirical applications, many of which support the
core assumptions of this perspective (e.g., Agnew and Raskin, 1992; Brez-
ina, 1996; Broidy and Agnew, 1997; Hoffmann and Miller, 1998; Paternos-
ter and Mazerolle, 1994). By contrast, only two prior studies have been
conducted specifically to test the institutional anomie theory: Chamlin and
Cochran (1995) and Messner and Rosenfeld (1997b). Building directly on
the unique features of both contributions, the purpose of our research is to
perform a more compelling appraisal of the institutional anomie theory
(IAT).

THEORY
As argued by Messner (1988), Merton’s statement of anomie theory
actually inheres two analytically independent causal arguments: one that
concerns the distribution of crime within the social unit (“strain theory”)

* I am grateful to Steve Messner and Rick Rosenfeld for sharing their data with
me. This paper has benefited from thoughtful comments by Steve Messner, James
Inverarity, the Editor of Criminology, and two anonymous reviewers.

CRIMINOLOGY VOLUME38 NUMBER4 2000 1021

1022 SAVOLAINEN

and one addressing variation in the level of crime across social units (“ano-
mie theory”). As Messner points out, much of the subsequent work pursu-
ing Merton’s legacy has focused on the strain theoretical argument
(according to Messner, the macrolevel component of Merton’s theory is
compatible with a number of individual-level aggregation mechanisms,
including social bonding and differential association theory). A defining
agenda of the IAT is to develop the neglected anomie theoretical element
of Merton’s contribution.
The conceptual model of the IAT is articulated in Messner and Rosen-
feld’s book, Crime and the American Dream (1997a). With Merton’s state-
ment as its point of departure, the IAT retains the core assumption that
the level of crime in a social unit depends on the balance between ele-
ments of culture and social structure. Although offering a more systematic
treatment of the cultural component of Merton’s theory, Messner and
Rosenfeld have not significantly altered the original meaning of “the
American Dream.” It still refers to a value orientation characterized by
the universal achievement goal of personal monetary success (Messner
and Rosenfeld, 1997a:61-65). The main revision suggested by the IAT
concerns the conceptualization of social structure.
In Merton’s theory, the anomic pressures inherent in the American
Dream channel into criminal behavior depending on the stratification of
legitimate economic opportunities. The more unequal the opportunities,
the higher the strain and, in consequence, the level of criminal offending.
Instead of focusing on this aspect of the social structure, Messner and
Rosenfeld expand the concept to include a more comprehensive set of
institutional contexts, such as the family, education, and the political
sphere. According to the IAT, the relative strength between institutions is
the most salient aspect of the social structure. Indeed, with its emphasis on
the relationships among functionally different elements of the society,
Messner and Rosenfeld’s concept of anomie bears close resemblance to
Durkheim’s discussion of anomic division of labor (Besnard, 1987:31-36).
An institutional balance of power in which the economy dominates
other institutions is assumed to be the most conducive to high rates of
serious crime because such an arrangement is the least capable of
restraining criminal motivations stimulated by the logic of egalitarian mar-
ket capitalism. At the level of culture, institutional imbalance of this
description generates value orientations that emphasize efficiency norms
at the expense of moral considerations; the “mood” of the society becomes
more predatory. At the level of social structure, weak noneconomic insti-
tutions are less capable of providing stakes in conformity in the form of
meaningful social roles.
 INEQUALITY, WELFARE STATE, AND HOMICIDE1023

PRIOR RESEARCH
As Chamlin and Cochran (1995) point out, Messner and Rosenfeld’s
model is rather complex and virtually impossible to test directly because of
the lack of appropriate measures for each of its concepts. However, draw-
ing on the fundamental aspects of this perspective, they have derived a
hypothesis that captures the empirical core of the IAT accurately. Accord-
ing to Chamlin and Cochran, Messner and Rosenfeld’s model implies that
in the presence of strong noneconomic institutions, economic stress will be
less salient as a predictor of serious crime. More specifically, they hypothe-
size that the impact of poverty on property crime is moderated by the
strength of religious, political, and family institutions. Results from their
state-level analysis are consistent with this hypothesis: high church mem-
bership, low divorce rate, and high voting percentage significantly reduced
the effect of poverty rate on property crime.
Messner and Rosenfeld (1997b) have produced their empirical applica-
tion of the IAT. It relies on Esping-Andersen’s (1990) decommodification
index as the indicator of economic dominance in the institutional balance
of power. In the most basic sense of the term, decommodification refers to
the degree to which the state protects the personal well-being of its citi-
zens from market dynamics (the quality and quantity of social rights and
entitlements). From the perspective of the IAT, decommodification “sig-
nals that the balance of institutional power in market society has shifted
from the economy toward the polity; it implies that purely economic val-
ues and criteria are accommodated to collective, political considerations”
(Messner and Rosenfeld, 1997b:1397). According to Messner and Rosen-
feld, decommodification taps only one dimension of the institutional bal-
ance of power, the relationship between the economy and the polity. In
our judgment, however, public policies associated with high levels of
decommodification, such as universal health care and parental leave
arrangements, are likely to improve the relative strength of other institu-
tions as well, particularly the family.
Redistribution of income and wealth is obviously a direct outcome of
the decommodification process. A strong negative association between the
level of decommodification and economic inequality is therefore expected.
However, as a novel prediction derived from the IAT, Messner and
Rosenfeld argue that decommodification should influence crime indepen-
dently of economic stratification. They propose that economic dominance
in the institutional balance of power “provides fertile soil for anomic cul-
tural pressures” while weakening “the external social control associated
with institutional attachments” (Messner and Rosenfeld, 1997b:1396-
1398). Their findings based on cross-national data support this hypothesis:
The index of decommodification has a relatively strong negative effect on
1024 SAVOLAINEN

national homicide rates controlling for economic discrimination, income

inequality, and the level of socioeconomic development.
We find both of these studies strong contributions to a promising theo-
retical research program. They differ from each other in three significant
respects. First, according to Chamlin and Cochran (1995), the IAT implies
an interaction effect between economic stratification and the strength of
noneconomic institutions. By contrast, Messner and Rosenfeld (1997b)
attend to the main effect of institutional balance of power net of economic
conditions. Second, the study by Chamlin and Cochran is based on Ameri-
can data with states as the units of analysis, whereas Messner and Rosen-
feld apply the theory in a cross-national setting. Finally, the dependent
variable in Chamlin and Cochran is property crime, whereas Messner and
Rosenfeld explain variation in homicide rates.

RESEARCH DESIGN
In their statement of the theory, Messner and Rosenfeld (1997a:39-44)
are explicit about its intended scope: Institutional anomie theory is meant
to explain macrolevel variation in serious criminal offending. In light of
this statement, the dependent variable and the unit of analysis are theoret-
ically sound in both studies. Both homicide and index property crimes are
clear instances of crimes located at the serious end of the offending contin-
uum, and states and nation-states are both examples of macrolevel
entities.
To be sure, because Messner and Rosenfeld rely exclusively on cross-
national data to illustrate macrolevel variation in serious offending, one
could argue, from a purely dogmatic standpoint, that nation-states consti-
tute more appropriate units of analysis than do the states of the Union. As
defined in the preface to Crime and the American Dream (Messner and
Rosenfeld, 1997a:x), the primary purpose of the book is to “present a
plausible explanation of the exceptionally high levels of serious crime in
the United States,” a goal that clearly calls for international comparisons.
Indeed, because international variation in the dominant cultural orienta-
tion is one of the key assumptions of the IAT, using states as the units of
analysis could be criticized for missing the point.
With its emphasis on the dominance of economic imperatives in the
social system, the IAT appears to provide a plausible account of the varia-
tion in the levels of property crime, but how can the relevance of this
model be extended to lethal interpersonal violence? Within the framework
of the classic Mertonian anomie theory, the link to violent crime is typi-
cally achieved by some version of the frustration-aggression hypothesis.
For example, at the macrolevel of analysis, Blau and Blau (1982:119) have
argued that groups that “cannot find realistic expression in striving to
 INEQUALITY, WELFARE STATE, AND HOMICIDE1025

achieve desired goals” may find an outlet in “diffuse aggression.”

Although still consistent with these types of assumptions, it should be
emphasized that the IAT attends more broadly to the role of social institu-
tions as agents of social control (Messner and Rosenfeld, 1997a:77 and 78):
Impotent families and schools are severely handicapped in their
efforts to promote allegiance to social rules, including legal prohibi-
tions. . . . The anomie associated with this cultural ethos thus tends to
neutralize and overpower normative restraints more generally, and
the selection of the means for realizing goals of any type, not simply
monetary goals, tend to be guided mainly by considerations of techni-
cal expediency. . . .
Institutions such as the family, schools, and the polity bear respon-
sibility not only for socialization, and hence the normative control
associated with culture, but also for the more external type of social
control associated with social structure. . . . [T]o the degree that
noneconomic institutions are relatively devalued, the attractiveness of
the roles that they offer for the members of society is diminished.
There is, accordingly, widespread detachment from these institutions
and weak institutional control.
Among other things, according to Messner and Rosenfeld (1997a:78),
this “generalized anomie” explains the unusually high levels of gun-related
violence in the United States.
The most significant discrepancy between the two studies has to do with
the causal form of the assumed effect: Should it be characterized as addi-
tive or interactive? Does the institutional balance of power affect crime
rates directly, or does this variable moderate the impact of economic strat-
ification? We are unable to resolve this question simply by drawing on the
original source of the IAT. Messner and Rosenfeld (1997a:77) provide an
analytical model, which is meant to describe the relationships among the
key concepts of this theory. Featuring as many as nine causal paths, includ-
ing two reciprocal relationships, we find this model too general and ambig-
uous for the problem at hand. Indeed, in our judgment, conceptual
clarification remains one of the more urgent tasks in the development of
this research program.
However, in our reading, a number of concrete statements in Messner
and Rosenfeld’s (1997a) discussion seem to imply an interaction effect.
For example, as cited by Chamlin and Cochran (1995419, Messner and
Rosenfeld argue that “war on poverty or on inequality of opportunity is
not likely to be an effective strategy for crime control in the absence of
other cultural and structural changes.” Even in their research, Messner
and Rosenfeld come very close to inferring effects that are interactional in
nature when discussing the findings from their additive models:
 SAVOLAINEN

“[I]nstitutional-anomie theory broadens the structural focus of traditional

economic stress or deprivation perspectives by directing attention to
aspects of the economic organization of market societies beyond the strati-
fication system, and to the interplay of the economy and other social insti-
tutions” (Messner and Rosenfeld, 1997b:1408; emphasis added).
Although both specifications seem compatible with the current state-
ment of the theory, in our judgment, the hypothesis involving an interac-
tion effect constitutes a more compelling rendering of the spirit of the IAT
than does the additive formulation. Moreover, in the absence of theoreti-
cal clarity, we deem it prudent to choose a test that is more stringent and
theoretically distinct. A mere negative relationship between the strength
of noneconomic institutions and the national homicide rate is consistent
with different interpretations. For example, given the obvious link
between the strength of the welfare state and economic marginalization,
decommodification could be conceived as an indicator of post-transfer ine-
quality in contrast to the income-based Gini index. According to this inter-
pretation, the research by Messner and Rosenfeld merely restates one of
the best-documented findings in cross-national criminology with a more
complete set of measures. The interactional version of the hypothesis
appears to hinge on a more unique kind of evidence and, therefore, consti-
tutes a more critical test of the theory.

HYPOTHESIS
To summarize the discussion so far, a critical test of the institutional
anomie theory should estimate the moderating effect of the institutional
context on the relationship between economic inequality and serious
crime, preferably at the cross-national level of analysis. Both of the prior
studies feature an appropriate dependent variable. From the perspective
of the ideal test, the main strength of Chamlin and Cochran’s (1995) con-
tribution is the interactional nature of the hypothesis, whereas the use of
cross-national data constitutes the unique strength of Messner and Rosen-
feld’s research. The basic purpose of our research is to combine these two
desirable properties in a single study. Specifically, we will test the hypothe-
sis that the positive effect of economic inequality on the level of lethal
violence is strongest in nations where the economy dominates the institu-
tional balance of power. This hypothesis implies a negative interaction
effect between economic stratification and the relative strength of
noneconomic institutions.
Our study shares important characteristics with research occurring
outside of the specific domain of the institutional anomie theory. First,
recent work by LaFree (1998) joins Messner and Rosenfeld’s perspective
in emphasizing the role of institutions as primary sources of macrolevel
 INEQUALITY, WELFARE STATE, AND HOMICIDE1027

variation in serious crime. According to his analysis, postwar trends in the

U.S. street crime rate reflect changes in the legitimacy of family, economy,
and the political institutions. On the other hand, a cross-national study by
Pampel and Gartner (1995) found strong support for the hypothesis that
the effect of the population age structure on the nations’ homicide rate
depends significantly on the sociopolitical context. Specifically, nations
featuring strong institutions for collective social protection were found to
be relatively immune to the criminogenic effects of changing age structure,
whereas the percentage of young people proved to be positively related to
the homicide rates of nations with low levels of collectivism. Our study
expects to find a similar conditional effect for economic stratification as
Pampel and Gartner found for age structure.

DATA AND METHODS

In criminological research, choosing nations as units of analysis entails
serious limitations for measures and sample characteristics. In order to
reduce these problems, the hypothesis will be tested with two complemen-
tary data sets. The sample from the Messner and Rosenfeld (1997b) study
constitutes the primary source of data in our research. To improve the
reliability and validity of these findings, a parallel set of analyses is con-
ducted with another data set, featuring a different sample of nations and a
partially different set of measures.

MESSNER AND ROSENFELD’S DATA

Adhering to a conventional practice in cross-national homicide

research, Messner and Rosenfeld measure national homicide rates by cal-
culating multiyear averages to eliminate the impact of short-term fluctua-
tions in the dependent variable. These data are obtained from the World
Health Organization (WHO) cause of death statistics covering the 10-year
period between 1980 and 1990. As the only source audited by a uniform
procedure, the WHO data are generally considered the most valid source
of international homicide statistics (LaFree, 1997). It should be noted,
though, that by treating homicide as a one-dimensional outcome, these
statistics provide a relatively crude picture of the phenomenon. For exam-
ple, the WHO data do not distinguish between murder and manslaughter.
The most serious limitation with this source, however, is the number and
the composition of nations reporting homicide data. Only 47 nations were
included in the 1995 edition of the WHO report (LaFree, 1997:123). The
maximum sample size in Messner and Rosenfeld’s data is 45. Twenty of
these nations are advanced industrialized countries, whereas only six of
1028 SAVOLAINEN

them represent either Asia or Africa. To reduce the skewness in the distri-
bution of these data, the dependent variable has been transformed into a
natural logarithmic scale.
The data for Esping-Andersen’s (1990) original measure of decom-
modification are available only for 18 advanced welfare states. His index is
generated by a sophisticated scoring system reflecting a large number of
national characteristics, including the level of political corporatism, univer-
salism of public benefits, and the nature of health care regimes. To tap the
essential elements of decommodification for a broader sample of nations,
Messner and Rosenfeld (1997b:1399) have developed a proxy measure
based on the data on the financial operations of national social security
systems collected by the International Labor Organization (ILO). Reflect-
ing both the level and the (universal) distribution of social security spend-
ing, this measure is highly correlated ( r = .84) with the original
decommodification index in the 18-nation sample.
The other independent variables in this data set include income inequal-
ity, economic discrimination, development index, and sex ratio. Income
inequality is measured with Gini coefficients from the period “circa 1969,”
which is more than a decade earlier than the period of interest. To comple-
ment the Gini-based measure, Messner and Rosenfeld use economic dis-
crimination as another indicator of economic inequality. Economic
discrimination refers to inequality based on an ascribed group characteris-
tic (race, ethnicity, religion, language, etc.). As such, this variable mea-
sures the “consolidated” nature of economic inequality. Previous research
by Messner (1989) found that economic discrimination is a stronger pre-
dictor of the national homicide rate than is the Gini index. The data on
economic discrimination were obtained from the Minorities at Risk data
file (Gurr and Scarritt, 1989). The specific indicator is an ordinal index
based on “expert judgements about the extent to which groups experience
objective economic disadvantages that are attributable to deliberate dis-
crimination” (Messner and Rosenfeld, 1997b:1403). The data on either
income inequality or economic discrimination are not available for 6 of the
45 nations.
To preserve degrees of freedom and to reduce the problem of multicol-
linearity, Messner and Rosenfeld combine several necessary control vari-
ables under a single index of socioeconomic development. A high value on
this index reflects high life expectancy, high GNP per capita, low infant
mortality, large elderly population, slow population growth, and high
levels of urban development. Of all the control variables of interest, only
the sex ratio of the population failed to cluster along this dimension of
socioeconomic development. In consequence, Messner and Rosenfeld
model it as a separate factor. As a way to reduce positive skewness in the
distribution, a natural log conversion is applied to the sex ratio scores.
 INEQUALITY, WELFARE STATE, AND HOMICIDE1029

SUPPLEMENTARY SAMPLE

After testing the hypothesis with the data collected by Messner and
Rosenfeld, the analyses are replicated with our own data set. This supple-
mentary file differs from Messner and Rosenfeld’s in the following
respects. First, it includes a different set of nations as units of analysis. The
most significant change is the inclusion of seven emerging market econo-
mies of Eastern Europe. Because Messner and Rosenfeld’s sample does
not contain any cases from this geopolitical context, this represents a non-
trivial improvement in the diversity of the national experience. (The lists
of nations included in the two samples are provided in Appendix 1). On
the other hand, because much of the data of interest have not been availa-
ble from these countries until recently, all of the variables, including the
dependent variable, are based on a single-year statistic (i.e., 1990), as
opposed to a multiyear average.
Second, using national homicide rates disaggregated by sex, these data
feature two dependent variables: the male and the female homicide vic-
timization rate. As stated previously, one of the limitations with the WHO
data is the crude definition of homicide. One way to improve the situation
is to use disaggregated rates. Gartner (1990:94) suggests that, compared
with men, women are more likely to be victimized in situations arising
from domestic or romantic disputes, whereas men are more likely to be
killed by strangers and for instrumental gain. In general, because the pro-
file of lethal violence may vary significantly across nations, it is advisable
to use disaggregated data for any comparative purposes (Zimring and
Hawkins, 1997:34-50). To be sure, the use of sex-specific rates is but a
minor step in that direction.
Third, the supplementary data file contains only one indicator of eco-
nomic inequality, the Gini index of income distribution. On the other
hand, based on observations from the period of interest (i.e., 1990), it
should be a more valid measure than is the one available in Messner and
Rosenfeld’s file. Fourth, the institutional balance of power is measured by
the amount of government spending on social security and other welfare
programs as a percentage of total public expenditures. Although it is a
conceptually crude rendering of the institutional context, empirically, this
variable overlaps reasonably well with Messner and Rosenfeld’s proxy
decommodification index. Using data from the same time period (mid-
1980s), we created a sample of 36 nations and computed a Pearson’s corre-
lation of .71 between the two variables. The data on income inequality and
welfare spending are obtained from the 1998 World Development Indica-
tors CD-ROM (World Bank, 1998).
The supplementary data set features two control variables included as
elements in Messner and Rosenfeld’s development index: GDP per capita
1030 SAVOLAINEN

and population age structure. All else equal, nations with a large elderly
population are likely to spend a larger proportion of the budget on pen-
sion benefits and health care programs than do nations with a young age
structure. On the other hand, because we expect to obtain a negative asso-
ciation between age and criminal offending, it is necessary to control for
the differences in the age structure of nations. This variable is measured as
the number of people at ages 15 to 24 as a percentage of the total popula-
tion around 1990 (United Nations, various years). Because the GDP per
capita is a general indicator of the nations’ socioeconomic status, it may
influence the relationships among economic inequality, welfare spending,
and homicide rate (World Bank, 1998). Finally, consistent with Messner
and Rosenfeld, we have also included sex ratio as a control variable. How-
ever, we differ from them in measuring sex ratio by its natural units, as it is
even less skewed in our data than is the log-transformed equivalent in
Messner and Rosenfeld’s data. The descriptive statistics for the variables
from both data files are provided in Appendix 2.
The sample of nation-states included in these two data sets is far from
representative of the nations of the world. The ones that are missing from
these analyses tend to be among the economically least developed or polit-
ically least democratic nations. However, it can be argued that the findings
from this research can be generalized fairly well to the population of
nations characterized by a market-driven economy and a democratic polit-
ical regime.

METHOD OF ESTIMATION
The multivariate models have been estimated in accordance with the
assumptions of the ordinary least-squares (OLS) regression. Given the
small size of our samples, we feel justified to adopt a more liberal standard
of statistical significance than usual. Following the standard used in Mess-
ner and Rosenfeld’s research, a regression coefficient that is more than 1.5
times larger than its standard error will be accepted as statistically signifi-
cant. Along more conventional lines, we shall also report if the p-value of
an estimate is .10 or smaller in a two-tailed test.
In order to reduce multicollinearity among the elements of the interac-
tion terms, all of the variables involved in the estimated interaction effects
have been centered, a practice recommended by Jaccard et al.
(1990:30-31). Centering is a form of additive transformation in which the
mean value of a variable is subtracted from each of its scores. In the Mess-
ner-Rosenfeld data, this procedure is applied to the following variables:
income inequality, economic discrimination, and decommodification. In
the supplementary data, the scores for income inequality and social secur-
ity spending have been centered. Appendix 3 displays the bivariate
associations among the variables from these two data sets.
 INEQUALITY, WELFARE STATE, AND HOMICIDE1031

With one exception, the independent variables in Messner and Rosen-

feld’s data file appear to be free from potential collinearity problems: The
correlation between the indices of development and decommodification is
2 3 . By comparison, the highest bivariate correlation coefficient among the
independent variables in the supplementary data set is -.71 (between
income inequality and welfare spending). To address the issue of multicol-
linearity more formally, we computed variance inflation factors for each of
the estimated models. According to the rule of thumb suggested by Fisher
and Mason (1981:105-106), predictors that score above 4.0 on the VIF are
associated with serious collinearity problems (this rule is also consistent
with the discussion in Fox, 1991:lO-13). In light of this standard, only the
development index, a control variable featured in the Messner and Rosen-
feld’s data file, is biased by multicollinearity. The analyses conducted with
the supplementary data set are entirely free from serious collinearity.

FINDINGS
Models 1 through 3 in Table 1 describe results from the analysis of the
maximum sample from the Messner-Rosenfeld data set. The N of 45 is
accomplished by way of means substitution for the missing values of
income inequality or economic discrimination. Model 1 estimates the main
effects of each independent variable. This model corresponds to equation
2 of Table 1 in Messner and Rosenfeld’s original study (Messner and
Rosenfeld, 1997bA404). As expected, the coefficients as well as the fit of
these two models are identical. Tho variables, sex ratio and the decom-
modification index, are statistically significant (at the .10 level). Model 1
explains 32.6% of the cross-national variation in homicide rate. Our speci-
fication of the institutional anomie theory predicts that the level of decom-
modification moderates the effect of economic inequality on the national
homicide rate. To test this hypothesis, we have estimated interaction
effects between the Gini index of income inequality and decommodifica-
tion (model 2) and between economic discrimination and decommodifica-
tion (model 3). Our prediction implies a negative coefficient for both
interaction terms.
As reported in Table 1, a negative interaction effect emerges in both
models, although it is statistically significant only in model 3. The magni-
tude of this coefficient indicates that for one standard deviation unit
increase in decommodification, the estimated effect of economic discrimi-
nation declines by .224 units. In order to examine the nature of this inter-
action effect in more concrete terms, we calculated point estimates for the
conditional effect of economic discrimination on the national homicide
rates of Finland and Mexico, two nations representing opposite ends (but
 Y

Table 1. Main and Interactive Effects of Income Inequality, Economic Discrimination, and
Decommodification on Average Homicide Victimization Rate (1980-1990),
Controlling for Nations’ Socioeconomic Development and Sex Ratio. OLS
Regression Coefficients
Independent Variable Model 1 Model 2 Model 3 Model 4 Model 5 Model 6
b B b L bLbBbLbL
Development Index -.017 -.057 -.016 -.052 -.021 7.070 -.095 -.350 -.lo3 -.365 -.093 -.329
(.077) (.078) (.075) (.088) (.089) (.086)
Sex Ratio (In) -5.755 -.250** -5.937 -.257** -5.545 -.240** -5.290 -.150 -6.159 -.174 -4.912 -.139
(3.330) (3.356) (3.239) (6.482) (6.609) (6.303)
Income Inequality 3.274 .212 3.278 .212 3.714 .240 1.496 .112 1.389 .lo4 2.025 .152
(2.836) (2.850) (2.767) (2.615) (2.633) (2.560)
Economic Discrimination .172 .182 .170 .180 .141 .149 .147 .177 .148 .179 .127 .1S3
(.128) (.128) (.12S) (.109) (.109) (.106)
Decommodification Index -.210 -.386** -.215 -.396** -.179 -.330 -.163 -.342* -.166 -.349* -.143 -.300
(.122) (.123) (.120) (.102) (.102) (-loo)
Income Inequality x -.744 -.097 -.626 -.095
Decommodification (.954) (.788)
Economic Discrimination -.092 -.224** -.072 -.200**
x Decommodification (.051) (-042)
Adjusted R2 .326 .319 .363 .480 .374 SO9
N 45 4s 45 39 39 39
* b > 1.5 (S.E.); **p < .10 (two-tailed test).
Note: Numbers in parentheses are standard errors.
 INEQUALITY, WELFARE STATE, AND HOMICIDE 1033

not the extreme values) of the decommodification scale.1 With decom-

modification at -2.16, the predicted effect of economic discrimination for
Mexico equals .340. By comparison, scoring 2.66 on the decommodifica-
tion index, the corresponding estimate for Finland equals -.104. In other
words, economic inequality based on ascribed group characteristics proves
to be a relatively strong positive determinant of the homicide rate in
nations characterized by low levels of decommodification, while having a
small negative effect among nations featuring strong collective institutions
of social protection.
Residing over three standard deviations below the predicted value,
Syria emerges as a potential outlier in these analyses. However, removing
this case did not affect the pattern of findings reported in models 1
through 3. These models were next reestimated with a reduced sample
excluding the six cases with missing values. As reported in models 4
through 6 of Table 1, both interaction terms remain negative, and the one
involving economic discrimination is still the only statistically significant
one. The only major difference between the results from the two samples
concerns the fit of the multivariate models: The adjusted R2 is systemati-
cally about 15% higher in models estimated with casewise deletion of
missing values. Throughout these analyses, the inclusion of the interaction
terms has little impact on the main effects of the independent variables,
which suggests that multicollinearity is not a problem.
So far, our research has failed to demonstrate a statistically significant
negative interaction effect between income inequality and the institutional
balance of power. The weaker success associated with this measure of eco-
nomic stratification may have to do with the fact that it is based on data
that are 10-20 years older than are the data used to measure decom-
modification and homicide. Time-appropriate measurement of income ine-
quality is one of the distinguishing characteristics of our supplementary
data file. Results from the analyses of these data are presented in Table 2.
Models 1 and 2 feature the male homicide victimization rate as the
dependent variable. In the baseline model (model l), sex ratio, income
inequality, and welfare spending emerge as the variables with statistically
significant regression coefficients. The effect of sex ratio is negative, which
implies that, all else equal, nations with a higher number of men than
women tend to have lower rates of homicide. It is likely that at least a part
of this relationship is causally reverse; i.e., a low male homicide rate may
have a positive impact on the sex ratio of a population. As predicted,

1. The point estimates have been calculated in accordance with the following
formula provided by Jaccard et al. (1990:26):p1at X 2 = PI + BYU,, where p1is the regres-
sion coefficient for XI (economic discrimination), p3 refers to the coefficient for the
product term, and X 2 is the value of the moderating variable (decommodification).
Table 2. Main and Interactive Effects of Income Inequality and Welfare Spending on Sex-
Specific Homicide Victimization Rates, Controlling for GNP, Age Structure, and
Sex Ratio. OLS Regression Coefficients ( N = 32)
Independent Variable Model 1 (Men) Model 2 (Men) Model 3 (Women) Model 4 (Women)
b B b B b B b B
GNP per Capita -.018 -.135 -.037 .277** -.008 -.095 -.022 -.261 m
(.019) (.ON) (.017) (.017)
% at Ages 15 to 24 -.003 -.060 .000 .005 -.002 -.058 .000 .018 $
0
(-005) (-004) (.004)
Sex Ratio -15.481 -.405** -13.610
(.ow-.356** -14.815 -.607** -13.423 -.550** F
U
(5.321) (4.719) (4.773) (4.455) Z
Income Inequality .064 .568** .073 .651** .024 .340* .031 .436**
(-018) (.016) (.016) (.016)
Welfare Spending -.048 -.442** -.028 -.259* -.033 -.474** -.018 -.261
(.019) (.OM) (.017) (.017)
Income Inequality x -.003 -.298** -.003 -.347**
Welfare Spending (-001) (.001)
Adjusted R2 .685 .756 .379 .468
* b > (12 x S.E.); **p < .lo (two-tailed test).
Note: Numbers in parentheses are standard errors.
 INEQUALITY, WELFARE STATE, AND HOMICIDE1035

income inequality has a positive and welfare spending a negative main

effect on male homicide rate.
Featuring an interaction term between income inequality and welfare
spending, model 2 constitutes a more critical test of the institutional ano-
mie theory. Consistent with the hypothesis, a negative interaction effect is
obtained that is statistically highly significant. Adding this product term in
the equation improves the fit of the model from 69% to 76%. Models
explaining cross-national variation in female homicide victimization rates
generate the same basic findings. The interaction effect between income
inequality and welfare spending is strong, negative, and statistically signifi-
cant, and the increase in the R2 is nine percentage points. (Note, however,
that this set of independent variables explains variation in male victimiza-
tion about 30 percentage points better.)
As previously, we calculated point estimates for the conditional effects
of income inequality for Finland and Mexico. During the period of inter-
est, the Finnish government spent 47.4% of the total budget on various
welfare programs, which is 20.1 percentage points above the average score
in this sample. As a result, the predicted effect of income inequality on the
Finnish male homicide victimization rate is -5.34 and -6.54 on the female
homicide rate. The corresponding estimates for Mexico, scoring -12.9 on
the centered measure of welfare spending, equal 4.50 and 4.91,
respectively.
The strong positive effects of income inequality on the homicide rate of
Mexico makes immediate sense from the perspective of the institutional
anomie theory. However, indicating that income inequality may actually
reduce the level of homicide, the point estimates for Finland may seem
counterintuitive. Why should economic equality reduce lethal violence in
the presence of strong collective institutions of social protection?
First of all, this effect is largely theoretical, given that, not surprisingly,
nations featuring the most generous welfare programs tend also to have
the lowest levels of income inequality. In this sample, only one nation
(Chile) with higher than average welfare spending ranks above the aver-
age level of income inequality. However, theoretically speaking, it is con-
ceivable that nations that safeguard their citizens from the vicissitudes of
market capitalism may actually benefit from income inequality. As a mat-
ter of fact, this finding is consistent with one of the most influential mod-
ern statements of social justice, A Theory ofJustice by John Rawls (1972).
As a key aspect of his theory, Rawls proposes the maximin principle,
which states that a just society is one that maximizes the well-being of the
worst off. Under this principle, income inequality, however large, may be
acceptable, insofar as it stimulates hard work, innovation, and economic
1036 SAVOLAINEN

productivity in general, and, by way of tax revenues, improves the situa-

tion of the poorest segment of the society (Kangas, 1998). The strong neg-
ative point estimate associated with Finland could be seen as an empirical
illustration of the maximin principle.

CONCLUSIONS
Drawing on the unique strengths of two prior tests of the institutional
anomie perspective, we developed a hypothesis predicting a negative
interaction effect between economic inequality and the strength of the
welfare state. Specifically, we hypothesized that economic inequality is a
strong determinant of the national homicide rates in societies character-
ized by weak institutions of social protection, but should not be a salient
predictor among the more collectivist nations. This hypothesis was tested
with two complementary data sets featuring slightly different samples of
nations and sets of measures.
Results from both samples provide support for the institutional anomie
theory. Each of the estimated interaction terms between an indicator of
economic inequality and the strength of the welfare state turned out nega-
tive. In the first sample, the interaction between economic discrimination
and decommodification was statistically significant, whereas the interac-
tion between the Gini index of income inequality and decommodification
was not. However, there emerged a strong and statistically significant neg-
ative interaction effect between income inequality and the level of welfare
spending in the supplementary data set, which features more appropriate
national measures of the Gini index.
To examine the nature of these interaction effects, we calculated condi-
tional effects of economic inequality at different levels of decommodifica-
tiodwelfare spending. The values of these point estimates confirmed the
hypothesized effects. Indeed, the negative point estimates at high values of
welfare spending suggest that economic inequality may actually lower the
homicide rates under such conditions. This finding, although largely theo-
retical, is consistent with Rawls’s theory of social justice.
In light of a large body of prior research, economic inequality is one of
the most robust determinants of cross-national variation in homicide
(LaFree, 1997:132).Attending to the sociopolitical context of this relation-
ship, the results from our research suggest an important qualification for
this basic finding. The fact that the effect of economic inequality on lethal
violence appears to be limited to nations characterized by low levels of
decommodification and welfare spending is inconsistent with a pure rela-
tive deprivation argument. It seems that the average distance between the
 INEQUALITY, WELFARE STATE, AND HOMICIDE1037

rich and the poor is not as significant a factor as the presence of an eco-
nomically marginalized population. Because of their generous welfare pro-
grams, the nations that appear to be immune to the detrimental effects of
economic inequality have a very small or nonexistent underclass popula-
tion. In light of our research, the size of the population living significantly
below the normative standard of economic well-being may be the critical
characteristic explaining the inequality effect in cross-national criminol-
ogy. In our view, this conclusion is consistent with the spirit of Merton’s
anomie theory and the letter of Messner and Rosenfeld’s institutional ano-
mie theory.

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 INEQUALITY, WELFARE STATE, AND HOMICIDE1039

Jukka Savolainen is a Senior Research Analyst at the New York City Criminal Justice
Agency. In addition to cross-national homicide and anomie theory, his current research
includes a study of criminal recidivism among participants in alternative-to-incarcera-
tion programs. Contact information: 52 Duane Street, 8th Floor, New York, N.Y.
10007; jsavolainen@nycja.org.
1040 SAVOLAINEN

Appendix 1. Samples of Nations

A. Messner and Rosenfeld’s Data Set (full sample, N = 45)
Argentina France Panama
Australia Germany, Federal Peru
Austria Republic Portugal
Belgium Greece Singapore
Brazil Guatemala Spain
Canada Ireland Sri Lanka
Chile Israel Sweden
Colombia Italy Switzerland
Costa Rica Jamaica Syria
Denmark Japan Thailand
Dominican Republic Kuwait Trinidad
Ecuador Mauritius United Kingdom
Egypt Mexico United States
El Salvador Netherlands Uruguay
Finland New Zealand Venezuela
Norway
B. The Supplementary Data Set ( N = 32)
Australia Ireland
Austria Israel
Brazil Latviaa
Bulgaria” Lithuania”
Canada Mexico
Chile Netherlands
Colombia Nicaraguaa
Costa Rica Norway
Czech Republica Panama
Denmark Paraguaya
Ecuador Poland”
El Salvador Romaniaa
Finland Spain
France Sweden
Germany United Kingdom
Hungarya United States
These nations are not included in Messner and Rosenfeld’s sample.
 INEQUALITY, WELFARE STATE, AND HOMICIDE1041

Appendix 2. Descriptive Statistics

Messner and Rosenfeld Data Mean S.D. -N
Homicide Rate (In) .97 1.29 45
Development Index .oo 4.24 45
Sex Ratio (In) 4.59 5.59 45
Income Inequality" .oo .09 40
Economic Discrimination" .oo 1.40 43
Decommodification" .oo 2.37 45
Income Inequality x
Decommodification -.14 .18 40
Economic Discrimination x
Decommodification -.93 3.21 43
The Supplementary Data Mean S.D. -N
Male Homicide Rate (In) 1.56 1.23 43
Female Homicide Rate (In) .35 .77 43
GNP per Capita 11.15 10.12 44
Percent at Ages 15 to 24 20.59 24.86 41
Sex Ratio .97 .04 44
Income Inequality a .oo 10.99 47
Welfare Spending a .oo 15.91 48
Income Inequality x
Welfare Spending -108.19 109.21 39
"These variables have been centered to reduce multicollinearity in the estimation of
interaction effects.
1042 SAVOLAINEN

Appendix 3. Bivariate Correlations.

A. Messner and Rosenfeld's Sample (Missing Values Deleted Listwise).
- Y - x1 - X2 - X3 - X4 - X5 - X6 - X7
Average Homicide Rate (In) 1.00 -.66 .35 .60 .38 -.68 -.07 -.31
Development Index 1.00 -.68 -.73 -.28 .83 .02 .13
Sex Ratio (In) 1.00 .29 .28 -.52 -.13 -.lo
Income Inequality" 1.00 .35 -.64 .01 -.04
Economic Discriminationa 1.00 -.32 -.02 -.13
Decommodification Indexa 1.00 -.02 .18
x3 * x 5 1.00 .64
(x7j x 4 * x 5 1.oo
"These variables have been centered to reduce multicollinearity in the estimation of
interaction effects.
B. The Supplementary Sample (Missing Values Deleted Listwise).
-Y1 - Y2 - X1 - X2 - X3 - X4 - X5 - X6
( Y l ) Male Homicide Rate (In) 1.00 .86 -.67 -.04 .18 .70 -.72 -.13
(Y2) Female Homicide Rate (In) 1.00 -.49 -.08 -.15 .35 -.46 -.26
(Xl) GNP per Capita 1.00 .01 -.17 -.54 .66 -.25
(X2) Percent at Ages 15 to 24 1.00 .19 .06 -.15 .17
(X3) Sex Ratio 1.00 .61 -.51 .14
(X4) Income Inequality" 1.00 -.71 .22
(X5) Welfare Spendinga 1.00 -.01
(X6) X4 * X5 1.oo
These variables have been centered to reduce multicollinearity in the estimation of
interaction effects.