Economic Focus – Malaysia’s Increasing Property Crime Rates

Source: Polis Diraja Malaysia

The placing of reported cases of property crime under the map of Malaysia might not be a very patriotic behavior of the common Malaysian citizen. Despite that, it is undeniable that the occurrence of property crime (burglary, car theft, etc) is on the rise.

Ironic enough is also the fact that the Malaysian economy recorded a GDP growth of 6.3%, a low unemployment rate of 3.3%, and a low inflation rate (CPI=2.0) in 2007. All these figures are estimates obtained through the World Bank Key Indicators that serve to show us that the Malaysian economy is as vibrant and strong as ever (well, at least on the surface).

Another weird happening is the outcome of the 2008 general elections whereby the National Front lost it’s two-third majority in the Parliament and with it almost all of the Northern States in Peninsular Malaysia. So here we are, stuck with the fact that Malaysia has a strong economic prospect (at least in aggregate terms), a poor election outcome, and an ever increasing property crime rates.

While economic analysis is not particularly useful in explaining crimes of ‘passion’ and violence (murder and rape), it may provide us an interesting insight on property crime. Like always, we start with setting the conditions that we are assuming criminals are rational. Both a lawful consumer and the criminal will try and maximize his/her total utility when performing a certain action.

Holding this to be true, criminals would only commit a crime only when the marginal benefit of the criminal act exceeds its marginal cost. Why steal something that is worth less than the risk, cost, and time taken to commit this act of stealing? Should operating a legal business be more profitable than burglary, who would be a burglar?

Among some of the reasons that I came up with includes inequal growth among the population, the ever rising cost of living, and the presence of price controls on approximately 30% of the goods taken into account for the calculation of the consumer price index (CIA, 2007 est). Each of the above factors may have contributed greatly towards the increasing crime rates and the poor outcome of the 2008 elections for the National Front.

Currently, I am working on a paper to identify which of the factors above are relevant and which are not. Due to the presence of an overload of economic and social data, this research has proved very taxing indeed. Yet, rest be assured that the report will be up on this site in two weeks time. Until then, try not to commit any criminal offenses even when they are profitable!

Facts – BBC

  • Full name: Federation of Malaysia
  • Population: 26.6 million (UN, 2007)
  • Capital: Kuala Lumpur
  • Area: 329,847 sq km (127,355 sq miles)
  • Major languages: Malay (official), English, Chinese dialects, Tamil, Telugu, Malayalam
  • Major religions: Islam, Buddhism, Taoism, Hinduism, Christianity, Sikhism
  • Life expectancy: 72 years (men), 77 years (women)
  • Monetary unit: 1 ringgit = 100 sen
  • Main exports: Electronic equipment, petroleum and liquefied natural gas, chemicals, palm oil, wood and wood products, rubber, textiles
  • GNI per capita: US $4,960 (World Bank, 2006)
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