Police levels and crime rates: An instrumental variables approach

While police levels may affect crime, governments may react to crime by increasing police levels. The instrumental variables (IV) approach to this problem has proven difficult due to the problem of locating instruments for police levels. Using panel data from over 5000 cities (1990–2001), we instrumented police levels with two types of federal law enforcement grants, thus yielding over-identified models. We also subjected our instruments to both relevance and validity testing, a step authors of similar studies have yet to take. We found fairly robust inverse associations between police levels and four index crime rates (homicide, robbery, assault, and burglary), but mainly in large cities.