Abstract

Abstract In economic models of crime changing economic incentives alter the participation of individuals in criminal activities. We critically appraise the work in this area. After a brief overview of the workhorse economics of crime model for organising our discussion on crime and economic incentives, we first document the significant rise of the economics of crime as a field of research in economics and then go on to review the evidence on the relationship between crime and economic incentives. We divide this discussion between incentives operating through legal wages in the formal labour market and into the economic returns to illegal activities. Evidence that economic incentives matter for crime emerges from both.