Understanding the economics of criminal activity in Kazakhstan

Abstract

This paper investigates the effects of various macroeconomic and demographic factors on criminal activity in Kazakhstan. In my analysis I focus on average gravity and grave crimes in addition to total crimes over the 2008-2016 period. Employing a fixed effects model I show that share of women and age group of 15-19 years age positively correlated, and shares of age group 0-14 and 50-64 years are negatively correlated both with total and average grave crimes. In addition, share of age group of 65+ years has a significant positive effect only for average grave crimes. On the other hand, unemployment rate is very highly and negatively correlated with both total and average crime rates. GDP per capita is estimated to be the only important determinant which negatively affects grave crimes. Furthermore, a-weights by locality population are employed to obtain estimates generalized for Kazakhstan. The findings suggest that women share positively affects all types of crime, both inflation and GDP per capita are positively correlated with total crime rate, and net migration has a positive effect on grave crimes. At the same time GDP per capita has a negative correlation with grave crimes. Additionally, unemployment rate has negative impacts for total and average gravity crimes but a positive impact for grave crimes. Moreover, age groups 0-14 and 50-64 years indicate negative influences on total and average gravity crimes, age groups 15-19 and 65+ have negative impacts on grave crimes while share of age group 35-49 positively correlates with it. Controlled year dummies are economically and statistically significant both for locality and country level estimates which provides evidence for a structural effect behind the recent increase in the crime rates.