Transborder spillover effects of poverty on crime: Applying spatial econometric models to Chinese data

Abstract

“Poverty is the mother of crime”, but existing literature has not yet analyzed the effect of local poverty on crimes in other jurisdictions. Based on 1992–2012 provincial data from China, this paper examines the transborder effects of poverty on crimes, by estimating spatial econometric models. Poverty is found to not only increase local crime, but also raise crime rates in other provinces. This spillover effect is more pronounced between provinces with close geographical proximity, high labor mobility and high dialect similarity. In addition, we compare the effects of increased police spending versus Dibao on poverty-related local and transborder crimes, finding that both can reduce poverty-related local crimes, but only Dibao can reduce poverty-related transborder crimes. The main policy implications of this paper are twofold. First, poverty alleviation can address both the symptoms and the root causes of local and external crimes, with broader and lasting effects than raising police spending. Thus, cross-border resource transfers shall target poverty alleviation; Second, poverty alleviation is not only a concern of the poor areas, but also a challenge for relatively developed areas in terms of crime governance.