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Crime, Security and Firms in Latin America (Short Note)
  • Mohammad Amin

Existing studies on crime are exclusively focused on crime against individuals and households. These studies show that crime is more rampant in the larger cities and against the relatively well off agents. Using Enterprise Surveys data for 14 Latin American countries we find that one third of the firms suffer from one or more incident of crime annually which is roughly similar to the available estimate of 38.6% for households. Crime related losses average 2.7% of annual sales for all firms in the sample which is more than the reported amount of bribery, losses due to power outages and firms’ expenditure on R&D. We also find that the relatively well off large firms are more likely to be victims of crime than the small firms but losses due to crime as a percentage of annual sales are bigger for small firms. In short, crime in the region is regressive. Last, larger cities are more prone to crime than the smaller cities. However, this holds only across cities within countries but not across countries. That is, what matters for crime is the relative size of a city within a country but its absolute size is irrelevant. We argue that this distinction is important for understanding the dynamics of crime and for the optimal design of crime prevention policies.

  • Crime,
  • Security,
  • Firms,
  • Latin America
Publication Date
April 1, 2009
Citation Information
Mohammad Amin. Crime, Security and Firms in Latin America (Short Note). (2009)
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