Counting the cost of crime in Italy

We gauge the cost of crime in Italy by concentrating on a subset of offences covering
about 64% of total recorded crimes in the year 2006. Following the breakdown of
costs put forward by Brand and Price, we focus on the costs in anticipation, as a consequence,
and in response to a specific offence. The estimated total social cost is more
than C38 billion, which amounts to about 2.6% of Italy’s GDP. To show the usefulness
of these measures, we borrow the elasticity estimates from recent studies concerning the
determinants of crime in Italy and calculate the cost associated with the surge in crime
fuelled by unemployment and pardons. Indeed, in both cases such costs are substantial,
implying that they should no longer be skipped when assessing the relative desirability
of public policies towards crime.