Economic Inequality, Demographics and Violent Crime : A Cross-National Panel Analysis of Homicide Rates, 2010-18

Abstract: Violent crime has many long-lasting negative consequences for society. This thesis aims to explore the relationship between economic inequality and violent crime, represented by the level of intentional homicides in forty-nine countries over the period of nine years from 2010-2018. We delve into several theories and representative works in the fields of criminology, sociology, psychology, and economics that provide important perspectives on the subject and offer a theoretical foundation for the analysis. Previous research has usually pointed to a positive association between inequality and crime rates, albeit with some notable outliers. Our objective was to provide an updated view on the subject, employing recent data and statistical methods. We use fixed-effects estimators to account for time-invariant determinants, provide random-effects estimators for control and apply a generalized methods of moments model for possible inertia regarding the dependent variable. Economic inequality in the form of income inequality does seem to cause more harm than what might be suspected at first, influencing the intentional homicide levels in a society. It is the duty of public and private bodies to foster policies that aim to reduce this trend, and thus diminish the societal costs associated with it.