Inequality and Crime Revisited: Effects of Local Inequality and Economic Segregation on Crime

Songman Kang, Hanyang University

Economic inequality has long been considered an important determinant of crime. Existing evidence, however, is mostly based on inadequately aggregated datasets, making its interpretation less than straightforward. Using tract- and county-level U.S. Census panel data, I decompose county-level income inequality into its within- and across-tract components, and show that crime is mostly negatively linked with within-tract inequality but not with across-tract inequality. This finding presents suggestive evidence that crime may be reduced by greater local inequality, which alleviates the extent of poverty concentration in disadvantaged neighborhoods where disproportionately many crimes take place.