Does Higher GDP Growth Mean Less Crime Against Property?

Why are crimes committed? And what are rising crimes linked to? Inequality, disparity, need, a feeling of lawlessness or desperation that arises from a combination of some of the above?

There are many well documented sociological answers to this question but fewer economic ones. The answer actually appears to be that there is very little correlation between growth and crimes. Except when it comes to crimes against property. Where there seems to be a somewhat direct correlation between an increase in GDP and a fall in crime rates.

One way to build a case is to take gross state domestic product (GSDP) as the indicator for economic growth of states and juxtapose the crime statistics to see what relation they bear on each other.

The questions that arise are i) whether growth in GSDP has any effect on increase in crime? ii) What types of crimes are on the rise in states with the highest and lowest GSDP growth? And iii) Whether there is a correlation between types of crime and growth?

We will further test the correlation between development and crime by looking at top five and bottom five states in terms of GSDP and see what types of crimes are more prevalent.

India's National Crime Records Bureau (NCRB) divides crimes recorded under the Indian Penal Code (IPC) under three broad categories: crime against body, crime against property and crime against women.

In this article, we shall be dealing only with crimeagainst property as we are trying to test the relationship between crime and economic growth. Arising from the belief that most crimes against property are more or less motivated and affected due to the economic environment.

The National Picture

Total crimes under IPC have been rising steadily since 2004. The number was around 1.8 million in 2004, which increased to 2.4 million in 2012, a rise of 30%. Real GDP growth went up from 6.9% in 2004-05 to a peak of 9.5% in 2006-07 and was down to 6.6% in 2011-12. And 465,055 crimes against property were recorded in 2012, an increase of 19% from 2011.

State-wise GSDP and Crime Rise

Before we return to crimes against property, let's look at year-on-year growth of GSDP and compare them to the year-on-year growth of overall IPC crimes. The states are arranged according to the highest year-on-year GSDP growth and higher than the national average of 6.6%.

Bihar has seen the highest increase in GDP growth from 0.1% in 2005-06 to 13.2% in 2011-12. On the other hand, states like Kerala and Gujarat have seen a decline in GSDP growth.

We can see that there has been an increase in total crimes in all the states. While Bihar has seen a 39% increase in IPC crimes, Kerala has seen a 65% jump in total IPC crimes. States with high GSDP growth have seen a corresponding increase in crime while Kerala and Gujarat (that have seen a slowdown in growth) have also seen a spurt in crimes.

Let us now look at the bottom 5 states arranged according to the lowest year-on-year growth and lower than the national average growth rate of 2011-12 of 6.6%.

There has been a decline in GDP growth in Odisha, Karnataka and Rajasthan while J&K saw marginal growth.

Crime in all these states has increased. J&K has shown a marginal increase in state GDP growth and has also reported an increase in crime.

Rise In Crimes Against Property

Now, let's return to the impact of GSDP growth on crimes against property in thehigh growth rate states.

It is interesting to see that crimes against property (like robbery, theft, dacoity and burglary) have declined in most states since 2005. For example, Chhattisgarh, which has seen GDP growth go up from 3.2% to 8.1% in 2005-06 and 2011-12, has seen a decline in crimes against property.

However, Bihar and MP actually show an increase in crimes against property along with the increase in growth rates. Another interesting aspect is that Kerala and Gujarat have seen a decline in their respective GDP growth have also seen a decline in crimes against property.

Now let us look at the bottom 5 states with respect to crimes against property between 2005 and 2011:

From the table above, it can be seen that there has been an increase in crimes against property in states with lower GDP growth. Punjab has seen a 51% increase in such cases followed by Odisha (26%). It is interesting to see that J&K, which had seen an increase in GDP growth, also recorded 25% increase in crimes against property.

Conclusion

It would appear that there is no correlation between increase in GSDP and the total increase in IPC crimes. However, there is some kind of impact of GSDP growth on crimes against property. High growth states see a lower number of crimes against property while low growth states see a higher number of crimes against poverty. We of course have not looked at indicators like income disparity and unemployment.