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6. Crime in Low-Income Neighborhood Consider a city where the burglary rate in a low-income neighborhood is 60, compared to 20 in a high-income neighborhood.
6. Crime in Low-Income Neighborhood Consider a city where the burglary rate in a low-income neighborhood is 60, compared to 20 in a high-income neighborhood. The two neighborhoods have the same victim cost per burglary ($1,500). The higher crime rate in the low- income neighborhood is efficient if . . . Illustrate. 7. Education and Crime Consider a city with 20 workers and two occupations: robber and electrician. For each occupation, the payoff curve (the payoff as a function of the number of workers) has a slope of -2 utils per worker. In the initial equilibrium, there are 10 robbers and 10 electricians, and a payoff of 20 utils. Suppose the government subsidizes community-college programs and thus increases the productivity of electricians, shifting the payoff curve upward by 12 utils. Illustrate the new equilibrium, including values for the number of electricians, the number of robbers, and the equilibrium payoff
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