The effects of business improvement districts in reducing nuisance crimes: Evidence from philadelphia

Previous studies showed that business improvement districts (BIDs) could contribute to an increase in property values and reduction in minor crimes in their areas. Estimating the effects of BIDs on the variables of property values and crime is methodologically challenging, however, because BIDs are not established randomly but selectively, according to the needs of commercial areas. The purpose of this study was to investigate the effects of BIDs on the nuisance crimes of graffiti, illegal dumping, and disorderly conduct in the city of Philadelphia between 1998 and 2009, using the system generalized method-of-moments estimator to address the problem of biased estimation caused by the nonrandom establishments of BIDs. We found that BIDs had negative significant effects on graffiti, illegal dumping, and disorderly conduct in their first 5 years of existence, but in their later years these effects were not significant.