Thirty years of reform and opening up has not only brought China soaring economic growth, but also an unexpected surging crime rate along the way. The number of crimes committed in 2008 stood at 4.88 million, almost 9 times that of 1978.
An article in China Daily applies economics to analyze the issu, and points out that very often social factors are behind the most gruesome crimes.
It says the distribution of wealth and resources is far from equal, and the social safety net in China is in tatters. These two facts combine to further promote rising crime rates. In pursuit of wealth, the poor have much less opportunity than the rich. Moreover, since the majority of Chinese people, especially the poor and rural dwellers, are not protected by any social security program, they are more vulnerable to economic risks. As a result, some of them are reduced into committing crimes.
The article suggests that economic growth negatively correlates with crime rates. A robust economy produces more jobs and pushes up wages, and thus increases channels for the poor to accumulate wealth in a legal manner. However, it stresses that the effect of economic growth in China has been overwhelmed by that of income disparity. Therefore, the key is bridging the income gap.
Some people may propose stricter punishment to curb crimes. But from an economic perspective, the cost of imposing punishment is formidable. Huge amounts of money have to be spent on the overheads in prisons, for instance. Furthermore, in light of "the law of diminishing marginal utility", the resort to punishment is not a cure-all, since it will become toothless beyond a certain point.
The resolution lies in wise public policies. The Chinese government should adopt policies that offer more jobs and drive up wages for the poor, so as to narrow the income disparity.
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