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Problem Set #5
Do Concealed Handgun Laws Reduce Crime?
Due: Wednesday October 17, 2018, 9 a.m.
Many U.S. states have enacted laws that allow citizens to carry concealed weapons. These laws
are known as “shall-issue” laws because they instruct local authorities to issue a concealed
weapons permit to all applicants who are citizens, mentally competent, and have not been
convicted of a felony (some states have some additional restrictions). Proponents argue that, if
more people carry concealed weapons, crime declines because criminals are deterred.
Opponents argue that crime increases because of spontaneous use of the weapon. In this
exercise, you will analyze the effect of concealed weapons laws on various types of crimes.
1. Read the notes to Tables 1 & 2, then fill them in. Mark the statistical significance of each
coefficient using +10%, *5%, **1% significance level (see past problem set solutions for
examples).
2. Write (type) a short essay (300 words max) summarizing the conclusions and caveats from
this study about the effect on crime of concealed weapons laws. Please address the following:
• Do the results for overall violent crime change when you add fixed state effects? When
you add time fixed effects? If so, which set of regression results are more credible, and
why;
• Are the differences in these estimates (if any) across categories of crimes consistent with
differences in the nature of the crimes and how they might be affected by concealed
weapons laws;
• In your view, how serious are any remaining sources of omitted variable bias or
functional form misspecification that might bias the results;
• Based on your analysis, what conclusions would you draw about the effects of concealed
weapons laws on these crime rates?
1
Department of Economics Economics 1123
Harvard University Fall 2018
Table 1
The Effect of Concealed Handgun Laws on Violent Crime: Regression Results
Notes: The dependent variable for each regression is given in the first row. All regressions
include an intercept. Standard errors (given in parentheses below regression coefficients) are
either heteroskedasticity-robust (HR), clustered standard errors (with the clustering at the state
level), or homoskedasticity-only/no autocorrelation standard errors. p-values (computed using
the indicated standard errors) appear in parentheses beneath heteroskedasticity-robust F-
statistics.
a
Regressions with “Socio-economic control variables” include the following regressors: rpcpi,
rpcui, rpcim, density, pbm1019, pbm2029, pwm1019, pwm2029.
2
Department of Economics Economics 1123
Harvard University Fall 2018
Table 2
The Effect of Concealed Handgun Laws by Type of Crime
3
Department of Economics Economics 1123
Harvard University Fall 2018
This dataset is a balanced panel of data on 50 US states, plus the District of Columbia (for a total
of 51 “states”), by year for 1977 – 2014, so an observation is a given state in a given year. There
are a total of 51 states x 38 years = 1938 observations. Crime rates are from the Bureau of
Justice Statistics.
Variable Definition
stateid numerical (integer) state ID (Alabama = 1, Alaska = 2, etc.)
year 4-digit year (1977, 1978,…, 2010)
state state name (string) (“Alabama”, etc.)
vio violent crime rate (incidents per 100,000 members of the population)
mur burglary crime rate (incidents per 100,000)
mur murder rate (incidents per 100,000)
aga aggravated assault rate (incidents per 100,000)
pap rape rate (incidents per 100,000)
auto motor vehicle crime rate (incidents per 100,000)
shall fraction of year state has a shall-issue law
density population per square mile of land area, divided by 1000
rpcpi real per capita personal income in the state
rpcui real per capita unemployment insurance payments in the state
rpcim real per capita government income support (“welfare”) payments in the
state
pbmAABB percent of state population that is black male, ages AA to BB
pwmAABB percent of state population that is white male, ages AA to BB
4
Department of Economics Economics 1123
Harvard University Fall 2018
STATA HINTS