1. 1 Dutch Euthanasia I--- Political Economy Currently, Dutch law permits doctors to administer a lethal dose of muscle relaxants and sedatives to terminally ill patients, at their request. The Groningen Protocol would permit doctors to euthanize patients who, according to the opinion of doctors and other medical experts, lack "free will." This category of unfortunate individuals would include newborn babies, persons in irreversible comas and persons with severe mental retardation. Worse, the Groningen hospital, after which the protocol is named, has already begun to administer the procedure, even without formal legal sanction. To date, Dutch prosecutors have refused to step in.

2. 2 Dutch Euthanasia II … more than 80% favor "voluntary euthanasia," according to recent polls. The Dutch Parliament recently passed a measure completely decriminalizing euthanasia and doctor- assisted suicide. The Netherlands is now the first democratic nation on earth to permit, under law, doctors to kill their patients. And they may be accustomed to doing so. Of the 130,000 Dutchmen who died in 1990, some 11,800 were killed or helped to die by their doctors, according to a 1991 report by the attorney general of the High Council of the Netherlands. An estimated 5,981 people--an average of 16 per day-- were killed by their doctors without their consent, according to the Dutch government report.

3. 3 Dutch Euthanasia III And these numbers do not measure several other groups that are put to death involuntarily: disabled infants, terminally ill children and mental patients. Some 8% of all infants who die in the Netherlands are killed by their doctors, according to a 1997 study published in the Lancet, a British medical journal. Consider the case of Dr. Henk Prins, who killed--with her parents' consent--a three-day old girl with spina bifida and an open wound at the base of her spine. Dr. Prins never made any attempt to treat the wound, according to Wesley J. Smith, author of the book "Culture of Death." The treatment was death. Many old people now fear Dutch hospitals. More than 10% of senior citizens who responded to a recent survey, which did not mention euthanasia, volunteered that they feared being killed by their doctors without their consent. One senior-citizen group printed up wallet cards that tell doctors that the cardholder opposes euthanasia.

4. 4 Readings on Crime, 13 August 2006, Eric Rasmusen 73 pages total. James Fitzjames Stephen, "The Doctrine of Liberty in Its Application to Morals," Chapter IV of Liberty, Equality, Fraternity, Hypertext by Terrence Berres, London: Smith, Elder, & Co. (1873) (my source here). Excerpt of 7 pages."The Doctrine of Liberty in Its Application to Morals,"here)Excerpt of 7 pages. William Stuntz, "The Political Constitution of Criminal Justice," 119 Harv. L. Rev. 780 (2006). Excerpt of 5 pages."The Political Constitution of Criminal Justice," Excerpt of 5 pages. Eric Rasmusen, "Stigma and Self-Fulfilling Expectations of Criminality," Journal of Law and Economics 39: 519-544 (October 1996). Excerpt of 8 pages.Excerpt of 8 pages. United States v. Estate of Parsons, 367 F.3d 409 (5th Cir. 2004), (6 of the 15 judges dissented, but I do not include the dissent.) 10 pages.367 F.3d 409 Richard Posner, Economic Analysis of Law, 4th ed. Sections 7.2-7.4, pp. 223-239, Little Brown (1992). 16 pages.Sections 7.2-7.4, pp. 223-239, Steven D. Levitt, "Understanding Why Crime Fell in the 1990s: Four Factors That Explain the Decline and Six That Do Not," The Journal of Economic Perspectives, 18, 1:163-190 (Winter 2004). 27 pages.

5. 5 Reference The slides that follow this are for answering questions, rather than for the presentation.

6. 6 Some data sources in the notes

7. 7 The Drivers Decision to Speed: First Cut 55 40 699080 mph Benefit or Cost Benefit Cost

8. 8 The Drivers Decision to Speed: Second Cut 55 40 709080 mph Benefit or Cost Benefit Cost 5467

9. 9 The Potential Criminals Decision 0 crimes Benefit or Cost Benefit cost his optimal choice moral cost

10. 10 The Publics Decision 0 crime reduction Benefit or Cost Benefit cost optimal choice fixed cost of courts, police

11. 11 The cost of crime is about $400 billion/year $150 billion in cost to victims (Cohen) $100 billion in private precautions (Anderson) ? in criminal time $150 billion for victimless crimes (pure guess; drug trade is $160 billion, Anderson says) We spend $72 billion on police, $57 billion on imprisonment, $38 billion on courts---$167 billion. That is the cost of keeping crime DOWN t $400 billion in costs.

12. 12 Should we increase police by 10%? Increasing police by 10% costs $7.2 billion directly. If court and prison costs increase at the same rate, the total cost is $16.7 billion. Add time costs of prisoners--$40K (2million)=$80B. Another $8 billion. But would prison costs fall with more police, less crime? A 10% rise in police causes a 3% decline in crime in a city, according to Marvell and Moody. The benefit, if we believe Marvell and Moody, is a 3% decline in crime, which is a benefit of $12 billion ($12 billion =.03 x $400 billion).

13. 13 Measuring What Affects Cost and Benefit: Simple Regression Crime per capita Police per capita error Metropolis Northville Southville Mudville Barchester Bay City

14. 14 Suppose you think a citys age profile, police, and prisons all reduce crime. You look and see that that on average: Cities with older citizens have less crime Cities with more police have less crime Cities with more prisoners per crime have less crime Problem 1--- Multiple Causes. If both aging and police reduce crime, how can we untangle them? Problem 2--- Coincidental Correlation. What if aging is the true cause, and it just happens that cities with older people have more police?

15. 15 Multiple Regression: The Logic Problem: most cities with an elderly population have lots of police too. So we cant untangle their effect on crime from looking at the correlations. Solution: look for cities where that is not true. Do cities with lots of elderly but few police have low crime? Do cities with few elderly but lots of police have low crime?

16. 16 Multiple Regression: The Math The computer finds values for a, b, and c that make the sum of squared errors added up over all cities as small as possible. Crime city = a - b*Police city - c*%over-65 city + error city Bay City 120 = 200 - 2x20- 3x25 +35 Mudville 100 = 200 - 2x30 -3x10 -10

17. 17 How much less crime is there in cities with more police?

18. 18 Problem 3, Reverse Causality: A city with a big crime problem will hire more police. One Solution: Use time lags 1. If crime increases in Northville by 10% in 2001, how many more police does Northville hire in 2002? 2. If Southville hires 10% more police in 2003, how much less crime is there in 2004?

19. 19 Marvell and Moody ( 56 cities, 1973-1993, * = significant ) Variables to be explained Target explanatory variablesPoliceCrime Police lagged one year.50* -.13* Police lagged two years<.01 --- Crime lagged one years -.01.79* Crime lagged two years.08* -.23* Control variables Population 15-17 -.09.06* Population 18-24.22 -.50 Population 25-34.20.32 Prisoner population<.01 -.12* African-American % -.06.02 Female-headed hslds..10.09 Education spending.20*.24* Welfare spending.04 -.02

20. 20 The Impact of Police A 10% rise in crime causes a 1.3% rise in the number of police in a city. A 10% rise in police causes a 3% decline in crime in a city. Declines range from 2.2% for larceny to 8.5% for car theft. One more officer results in 24 fewer crimes---.02 homicides,.1 rapes, 1.8 robberies, 5.3 burglaries, 12.5 larcenies, and 4.5 auto thefts. The effect on assault was statistically insignificant.

21. 21 The Prison Population and Crime Crime is roughly level 1980-1995, and then starts dropping. The prison population rises steadily.

22. 22 Leavitt--Prisons Same problem as before: If crime rises, so does imprisonment. The South has higher crime, higher imprisonment. We could use the same approach as Marvel-Moody: see if crime falls after imprisonment rises. But we will look at a different approach: find a situation where imprisonment rises for a reason clearly unrelated to an increase in criminality. Leavitt used prison overcrowding litigation

23. 23 Reverse Causality Again (1) Longer prison terms reduce crime. (2) If there is more crime, people call for longer prison terms. Effect (1) tends towards a negative correlation, while effect (2) tends towards a positive correlation between prison and crime. Just like police and crime. Thus, we might see crime and prison terms rising simultaneously.

24. 24 We need an experiment in changing the prison population The scientific approach would be to do an experiment. Cut the prison population by 0% in Indiana, 10% in Iowa, 20% in Pennsylvania, 50% in Virginia. See what happens to crime over the next 10 years.

25. 25 If prisoners are let free by a court order, does crime rise? From 1971-1993, 12 states had had their entire prison system under court order for overcrowding. ( Alabama, Alaska, Arkansas, Delaware, Florida, Mississippi, New Mexico, Oklahoma, Rhode Island, South Carolina, Tennessee, Texas) Levitt looks at what happens to prison population and crime rates at key points in the litigation process

26. 26 Response of Prison Population and Crime Rates to Prison Overcrowding Litigation - (Final Decision) (Deviation from National Average Growth Rates)

27. 27 Levitts Results Levitt finds that a 10% increase in the prison population would reduce violent crime by about 4% and property crime by about 3%. Levitt estimated that keeping one extra prisoner for one year eliminated approximately 15 crimes in 1993. That implies that increasing imprisonment would have more benefit than cost. Crime has dropped by 40-50 percent since 1993 and the number of prisoners has increased so that today imprisoning one extra prisoner for one year eliminates fewer crimes. There are diminishing returns. The extra benefit has fallen, while the extra cost has stayed roughly constant. If the benefit– the number of crimes eliminated--- is down to 3 crimes per prisoner, increasing punishment now would have more cost than benefit. Conclusion: It is no contradiction to say that the increase in imprisonment in the 1990s was good, but to keep up that rate of increase would be bad, from the point of view of cost-benefit analysis. The optimal rate of imprisonment is neither 0% nor 100% of the population--- we have to stop somewhere.

28. 28 Summary 1.We can look at the crime quantity level as the result of tastes and incentives, just like economic markets, except that the transaction is involuntary. 2. The costs of both crime and crime control are high, and the big question is how much a small rise or fall in spending on crime control from current levels would reduce crime. 3. We cant just look at simple correlations because of a) reverse causality b) multiple causes, and c) accidental correlations. 4. Regression analysis is a way to tackle these problems. 5. Police and Prisons do reduce crime. In the early 1990s, it seems increases in both were cost-effective. By 2006, this is much less clear. Some fact tidbits: Burglary rates are lower in the US than in Canada, England, and Australia, about the same as in Sweden and the Netherlands, and higher than in Switzerland. 48% more arrests are made for alcohol offenses than for drug offenses. Levitt finds that a 10% increase in the prison population would reduce violent crime by about 4% and property crime by about 3%.

29. 29 How about voluntary death? A wealthy sportsman concludes that the only game dangerous enough to be really worth hunting is man. He offers ten adventurers $100,000 each in exchange for their agreeing that he may choose one of the ten at random and attempt to kill him. They agree. (David Friedman) Should this be murder? Should the contracts be enforced by the courts? (think about prizefighting)

30. 30 Incentives The ex post approach: Someone has done something bad and ended up in court. What should we do? --procedures, sentences The ex ante approach: Someone might do something bad and end up in court. What should we do? --- laws, penalties

31. 31 Reference The slides that follow this are for answering questions, rather than for the presentation.

32. 32 Surveys vs. Police Reports

33. 33

34. 34 Drug Use by Arrestees

35. 35 Marginal Cost and Benefit 0 crimes Benefit or Cost Marginal Benefit Marginal Cost his optimal choice

36. 36 Crime Statistics 1.3 million violent, 10.4 million nonviolent index crimes reported (violent– murder, rape, aggravated assault, robbery) (nonviolent- larceny, burglary, car theft) 2.1 million violent, 18.6 million nonviolent, by survey (not including business victims) 14 million arrests for all offenses (1.6 million for index crimes) Adults, 84%, Juveniles 16% Males 76%, Females 24% White 71%, Black 27%, Other 2%.

37. 37 Reverse Causality Example Northville: 80 police, 40 burglaries 100 police, 30 burglaries Southville: 80 police, 25 burglaries 100 police, 18 burglaries Southville chooses 80 police, Northville, 100 police. It will seem that the 20 extra police cause 15 extra burglaries.

38. 38 Another Kind of Incentive: Complements and Substitutes Bread and Potatoes are substitutes. If the price of potatoes rises, people eat more bread instead. Bread and butter are complements. If the price of butter falls, people eat more butter AND more bread. Crime and dishwashing jobs are substitutes. Crime and pawnshops are complements.