Crime Reporting Decisions and the Costs of Crime

The paper develops a model of crime reporting based on an economic approach. It identifies the principal costs and benefits of reporting from the victim’s perspective, taking account of insurance provision and the risk of intimidation by an offender. It shows how a victim might use backward induction to infer a rational reporting strategy. The recording of crime by the police is a process that relies on victim reports, and is thus influenced by the reporting decisions made by victims. The paper uses empirical evidence from the British Crime Survey and from the International Crime Victims Survey to explore the hypotheses generated by the model. It finds support for the suggestion that the propensity to report a crime increases with the size of the loss entailed. The paper also explores the implications of the findings for the estimation of the costs of crime. Reporting and intimidation costs are generally excluded from bottom-up estimates of costs, an omission that may be quite serious in the context of offences such as domestic violence.