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CID Working Paper No. 131

Crime, Justice, and Growth in South Africa: Toward a Plausible Contribution from Criminal Justice to Economic Growth

Christopher Stone

August, 2006

A publication of the CID South Africa Growth Initiative

Abstract

Crime in South Africa is high and widely believed to restrain investment. Nevertheless, both the mechanisms through which crime constrains growth and the actions that might be taken to loosen its grip are poorly understood. In light of the limited knowledge in the field and the limited capacity of criminal justice institutions, this paper proposes focusing on two issues: (1) the costs of crime to business, especially household-based enterprises in low-income settlements, and (2) the perception of violent crime. In both cases, the paper proposes a cyclical process of iterative innovation in which government seeks to solve narrowly circumscribed crime problems, and then leverages each success to generate wider hope and confidence in the criminal justice system.

Keywords: South Africa, crime

JEL codes: O55, K42

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