Lending and Banks and Crimes, Oh My! The Effect of Financial Institutions and Residential Lending on Neighborhood Crime

• In Event: Faith and Finances: How Local Institutions like Churches and Banks Matter

Abstract

The role of banks as an organization within the neighborhood is largely absent from the literature of social disorganization theory. Banks play an important role in the everyday lives of their customers and can potentially have an important impact on the neighborhoods they are located in. Research on the prime lending market has found that the infusion of resources into neighborhoods in the form of home loans result in significant reductions in crime (Peterson and Krivo 2009a, 2009b; Squires and Kubrin 2006; Vélez 2009; Vélez, Lyons, and Boursaw 2012; Vélez and Richardson 2012).
The current research will draw on the political economy approach to test social disorganization theory and to examine the role of neighborhood institutions, specifically banks on crime. These questions will be investigated by combining several sources of available data. Crime data from Norfolk and Virginia Beach, residential lending data made available from the Home Mortgage Disclosure Act, addresses of banks from the Polk City Directories, and the American Community Survey will be used to create several control variables that will be included in the analyses.

Author

• Anne M. Lee, Old Dominion University