The effect of the crime rate on overall life satisfaction is relatively small, a Vanderbilt researcher has reported.
While public opinion polls show that people think crime should be a high priority for local governments, crime appears to be only a small factor in a person’s feeling of well-being, according to the study’s author, Mark Cohen, the Justin Potter Professor of American Competitive Enterprise at Vanderbilt’s Owen Graduate School of Management.
In "The Effect of Crime on Life Satisfaction," Cohen finds that a person’s perception of neighborhood safety is more important to feeling happy than the actual crime rate in the county in which they reside. "Living within a mile of an area thought to be unsafe does reduce a person’s life satisfaction score. However, controlling for actual victimization reduces the significance level of those findings," Cohen said.
Not surprisingly, Cohen found that "an actual crime event has an even more significant effect on life satisfaction." People who were victims of home burglary, for example, experienced a significant reduction in life satisfaction – almost as much as someone whose health goes from a "good" to "fair" state.
Why are people who live in less safe neighborhoods just as happy (or nearly so) as their neighbors in lower crime areas? One reason, Cohen speculates, is that people who live in less safe neighborhoods have adapted in other ways – by purchasing burglar alarms, for example – or are compensated for assuming a higher risk of victimization through lower housing and rental prices.
Cohen, also a law professor at Vanderbilt, has extensive expertise analyzing government enforcement policies with particular emphasis on environmental and criminal justice issues. A leading expert on corporate crime and punishment, he has published extensive analyses of the "cost" of crime.
In this study, Cohen finds that the compensating income value for a home burglary is $83,772. He also found that moving from a safe to an unsafe neighborhood, based on perceptions of safety, requires $34,322 in additional annual compensation for the average household.
The article is scheduled for publication in an upcoming issue of Journal of Legal Studies and is available for download at http://ssrn.com/abstract=1091542.
Vanderbilt’s Owen Graduate School of Management is ranked as a top institution by Business Week, The Wall Street Journal, U.S. News & World Report, Financial Times and Forbes. For more information about Owen, visit www.owen.vanderbilt.edu.
Media Contact: Jennifer Johnston (615) 322-NEWS
Jennifer.johnston@vanderbilt.edu