Wednesday, June 9, 2010

Prison Population vs. Economic Freedom

If we graphed the percentage of the population in prison against the amount of economic freedom in a country, what relation would we expect?

My guess is a weakly positive correlation. Income inequality, which capitalism generates, gives people an incentive to steal. That would create a positive correlation between crime and economic freedom. More importantly, the institutions that make an economy free for business (enforcing contracts, functioning justice system, private property) are related to the institutions that lead to arrests (functioning justice system, capable police force).

Mike Konczal, blogging for Ezra Klein, finds the expected positive correlation. (Then says it's counter-intuitive and provides a number of bizarre explanations. File under "???" or "Liberals who hate the Cato Institute?")

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