The Relationship between key economic variables and Crime: Markov-Switching Approach

In this study, considering the importance of crime and its harmful socio-economic effects, after specifying the model to investigate the economic factors affecting crime (unemployment rate, inflation rate and real exchange rate) on crime using the Markov-swtiching model and time series data (1984-2013) has been studied in Iran.The main focus of the paper is on crime and unemployment variables and other influential variables have been included in the model of control variables vector.. The results show that the relationship between unemployment at high levels of crime is positive and direct and at low levels of crime there is a negative relationship, and other economic variables such as real exchange rate, inflation rate have a positive effect on crime. Crime as a phenomenon Social, like other social phenomena, has different dimensions, and various factors can play a role in its occurrence, and as a result, social phenomena change slowly. Thus, if the social and economic environment of politics has a direct impact on crime rates, crime cannot be prevented in a country by increasing the punishment for criminals or forcing the police to deal with them or creating economic well-being and raising their standard of living. Preventing the crime of persons requires a comprehensive effort in all its dimensions so as to achieve success in this regard.