THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 1 The Economics of Bank Robberies in New England Kimberly A. Leonard, Diane L. Marley & Charlotte A. Senno The University of Rhode Island, STA308 Comment [N1]: Very good work. Points: 75 / 75
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 2 Abstract The topic of the paper was to prove an increase in the number of bank robberies in the six New England states of Maine, New Hampshire, Vermont, Massachusetts, Connecticut and Rhode Island as years increased since 2003. Seven years worth of data was collected on these six states in the areas of bank robberies, unemployment, bankruptcy and state population. Paired T-tests for the following pairs: 2003-2004, 2004-2005, 2005-2006, 2006-2007, 2007-2008, 2008-2009 were calculated to determine if there was an increase in bank robberies and unemployment. The team found no significant increase in the number of bank robberies over the seven years; however, we found an increase in unemployment in years 2007 2009. Using a chi-square test for independence, we found that when looking at bank robberies and bankruptcies the variables years and states are not independent and unemployment rates were independent. We found no relationship between unemployment rates and bank robberies using a linear regression. Therefore, our hypothesis of bank robberies increasing over time has been disproved. Introduction Recent Rhode Island media coverage has included a large number of stories on local bank robberies. Media focus also remains largely on the current economic condition. But are the two issues connected? Our hypothesis is that the frequency of bank robberies increases as economic
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 3 stability decreases. We chose to define economic stability as a combination of two variables: unemployment rate and bankruptcy filings. An increase in either variable is taken to indicate a weaker economy, whereas lower numbers are representative of more stability. In order to prove or disprove our hypothesis, the research team has chosen to collect data on each of the six New England States: Connecticut, New Hampshire, Massachusetts, Maine, Rhode Island and Vermont. For each state, the number of bank robberies, percentage of unemployment, and number of bankruptcy filings has been collected for a seven year period, from 2003-2009. (We planned on a ten year period, but FBI statistics were unavailable from 2000-2002. However, this actually helps to minimize error, as the economic condition around 9/11 would certainly be an outlier.) The state population by year is also included for use in comparison and analysis of data. Lit Review Comment [N2]: Don t use abbreviations Unemployment figures are drawn from the US Department of Labor (USDL) which provides seasonally adjusted new filings and persons currently receiving benefits. The percentages given do not include the number of persons who have exhausted their benefits, under employed individuals, those who are no longer looking for work nor the economic class of claimants. According to the USDL Seasonal adjustment is a statistical method for removing the seasonal component of a time series used when analyzing non-seasonal trends. Whereas, not seasonally adjusted reflects the actual current data. It is normal to report not seasonally adjusted data for current unemployment rates. Seasonally adjusted data may be used for the longer term comparison.
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 4 Bankruptcy is the The legal process involved: the administration of an insolvent debtor s property by the court for the benefit of the debtor s creditors. Filing by a debtor is called voluntary bankruptcy; involuntary bankruptcy is declared by the court upon petition by creditor (Britannica Concise Encyclopedia). We have chosen to represent bankruptcy as a total number of filings per state, disregarding the category the bankruptcies were filed in. Our bankruptcy data was collected from uscourts.gov. The FBI Bank Crime Statistics electronic database lists the number of bank robberies, bank burglaries, bank larcenies and bank extortions per year since calendar year 2003. Definitions obtained from the US Attorneys Manual define these illegal activities as: A bank robbery is the taking or attempted taking by force, intimidation, or extortion, of any property in the care, custody, control, management or possession of any bank, credit union, or savings and loan association. Typically, some form of violence is demonstrated. In contrast, a bank larceny is the taking of property in nonviolent face-to-face encounter and bank extortion arises where, by telephone call or other communication, an extortionist conveys a threat to a bank official. Where robberies take place during an institutions working hours, burglaries include breaking and entering when the institution in question is closed. For our data and analysis, we defined bank robberies as an inclusive term: one value representing a combination of bank robberies, larcenies, extortions and burglaries. Methods The team collected yearly data from 2003 2009 for the six New England states. Data was collected in the following areas: number of bank robberies, unemployment rate and bankruptcy filings. State population was also collected. This information is outlined
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 5 below, in both tables and graphs. Bank Robberies State 2003 2004 2005 2006 2007 2008 2009 CT 109 89 89 72 100 79 82 ME 11 3 12 22 2 11 9 MA 307 239 237 281 192 292 183 NH 14 26 33 23 15 19 11 RI 42 44 28 36 20 10 17 VT 3 3 7 4 4 2 10 Unemployment Rate State 2003 2004 2005 2006 2007 2008 2009 CT 5.46 4.93 4.86 4.43 4.58 5.61 8.23 ME 5.03 4.63 4.88 4.67 4.67 5.36 8.03 MA 5.81 5.22 4.84 4.76 4.43 5.3 8.42 NH 4.46 3.88 6.33 3.54 3.53 3.92 6.32 RI 5.42 5.24 5.08 5.03 5.3 7.65 11.21 VT 4.46 3.71 3.52 3.73 3.93 4.53 6.88 Bankruptcy Filings State 2003 2004 2005 2006 2007 2008 2009 CT 12,246 11,423 15,272 5025 5890 8229 10334 ME 4660 4508 6614 1323 2304 3033 3871 MA 18260 18444 26714 8400 13705 16538 20966 NH 4426 4651 6097 1925 2983 3931 5233 RI 4557 4142 5839 1621 2817 4300 5096 VT 1903 1698 2622 655 895 1275 1559 U.S. Census State Pop State 2003 2004 2005 2006 2007 2008 2009 CT 3467673 3474610 3477416 3485162 3488633 3502932 3518288 ME 1303102 1308253 1311631 1314963 1317308 1319691 1318301 MA 6451637 6451279 6453031 6466399 6499275 6543595 6593587 NH 1281871 1292766 1301415 1311894 1317343 1321872 1324575 RI 1071504 1071414 1064989 1060196 1055009 1053502 1053209 VT 616559 618145 618814 619985 620460 621049 621760
Bank Robberies Population THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 6 New England State Populations, 2003-2009 7000000 6000000 5000000 4000000 3000000 2000000 1000000 0 1 2 3 4 5 Year CT ME MA NH RI VT N.E. Bank Robberies, 2003-2009 350 300 250 200 150 100 50 CT ME MA NH RI VT 0 1 2 3 4 5 Year
Percent Unemployment (%) # of Filings THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 7 Bankruptcy Filings, 2003-2009 30,000 20,000 10,000 0 1 2 3 4 5 Year CT ME MA NH RI 15 10 5 0 Unemployment Rates, 2003-2009 1 2 3 4 5 Year CT ME MA NH RI VT Mean, Median, Mode Summary statistics: Bank Robberies Column n Std. Dev. Std. Err. Median Range Min Max Q1 Q3 Mean 2003 6 117.34905 47.90755 28 304 3 307 11 109 81 2007 6 76.19383 31.106 17.5 190 2 192 4 100 55.5 2004 6 89.96592 36.72843 35 236 3 239 3 89 67.333336 2005 6 87.95832 35.908836 30.5 230 7 237 12 89 67.666664 2006 6 104.39923 42.620808 29.5 277 4 281 22 72 73 2008 6 112.83868 46.066196 15 290 2 292 10 79 68.833336 2009 6 70.11419 28.623999 14 174 9 183 10 82 52 Comment [N3]: When presenting your data always use the same number of decimal points in a column. Unless the numbers are very small a two or three decimal accuracy should be enough
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 8 Summary statistics: Unemployment Rates Column n Mean Std. Dev. Std. Err. Median Range Min Max Q1 Q3 2003 6 5.1066666 0.5585577 0.22803022 5.225 1.35 4.46 5.81 4.46 5.46 2004 6 4.6016665 0.6654748 0.27167892 4.78 1.53 3.71 5.24 3.88 5.22 2005 6 4.9183335 0.8927803 0.36447603 4.87 2.81 3.52 6.33 4.84 5.08 2006 6 4.36 0.5965233 0.2435296 4.55 1.49 3.54 5.03 3.73 4.76 2007 6 4.4066668 0.615424 0.2512458 4.505 1.77 3.53 5.3 3.93 4.67 2008 6 5.395 1.270067 0.51850265 5.33 3.73 3.92 7.65 4.53 5.61 2009 6 8.181666 1.6978271 0.69313496 8.13 4.89 6.32 11.21 6.88 8.42 Summary statistics: Bankruptcy Filings Column n Mean Std. Dev. Std. Err. Median Range Min Max Q1 Q3 2003 6 7675.3335 6254.9243 2553.5623 4608.5 16357 1903 18260 4426 12246 2004 6 7477.6665 6279.591 2563.6323 4579.5 16746 1698 18444 4142 11423 2005 6 10526.333 8988.18 3669.4087 6355.5 24092 2622 26714 5839 15272 2006 6 3158.1667 2982.5876 1217.6364 1773 7745 655 8400 1323 5025 2007 6 4765.6665 4673.1763 1907.8162 2900 12810 895 13705 2304 5890 2008 6 6217.6665 5550.371 2265.9294 4115.5 15263 1275 16538 3033 8229 2009 6 7843.1665 7043.32 2875.423 5164.5 19407 1559 20966 3871 10334 Summary statistics: State Population Column n Mean Std. Dev. Std. Err. Median Range Min Max Q1 Q3 2003 6 2365391 2233717.2 911911.25 1292486.5 5835078 616559 6451637 1071504 3467673 2004 6 2369411.2 2232490 911410.25 1300509.5 5833134 618145 6451279 1071414 3474610 2005 6 2371216 2232900.8 911577.94 1306523 5834217 618814 6453031 1064989 3477416 2006 6 2376433.2 2237617.2 913503.4 1313428.5 5846414 619985 6466399 1060196 3485162 2009 6 2404953.2 2286446.5 933437.9 1321438 5971827 621760 6593587 1053209 3518288 2007 6 2383004.8 2249781.2 918469.3 1317325.5 5878815 620460 6499275 1055009 3488633 2008 6 2393773.5 2266837.2 925432.44 1320781.5 5922546 621049 6543595 1053502 3502932
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 9 Population is consistent for each state over the seven year period. The shape is fairly consistent with unemployment with the exception of New Hampshire in fiscal year 2005. Bankruptcy filings have a consistent shape for all states; however, Massachusetts and Connecticut have significantly higher rates. The number of bank robberies reflects a relatively similar shape with outliers in Massachusetts and Connecticut shows elevated rates. Comment [N4]: Label your graphs / charts and then refer to them when analyzing.
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 10 The median in the bank robbery box plot is relatively the same throughout and the IQR which represents 50% of the data is also stable across the years. The outliers are from the bank robberies committed in Massachusetts as seen on the line graphs. The median in the box plot reflecting bankruptcy filings are consistent except in 2005 and 2006. Further research shows that a change in bankruptcy laws which made filing for bankruptcy more difficult drove the number of filings up in 2005 followed by a much lower amount in 2006, once the law went into effect. This also resulted in the drastic lowering of the IQR in 2006, which remained fairly low for the rest of the years we observed. Analysis & Results Paired T Test Hypothesis test results: Bank Robberies μ 1 - μ 2 : mean of the paired difference between 2003 and 2004 2003-2004 13.666667 11.712292 5 1.1668652 0.8521 Tcv = -2.015 Hypothesis test results: Bank Robberies μ 1 - μ 2 : mean of the paired difference between 2004 and 2005 2004-2005 -0.33333334 3.6757464 5-0.09068453 0.4656
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 11 Hypothesis test results: Bank Robberies μ 1 - μ 2 : mean of the paired difference between 2005 and 2006 2005-2006 -5.3333335 8.807825 5-0.6055222 0.2856 Hypothesis test results: Bank Robberies μ 1 - μ 2 : mean of the paired difference between 2006 and 2007 2006-2007 17.5 15.903354 5 1.1003969 0.8394 Hypothesis test results: Bank Robberies μ 1 - μ 2 : mean of the paired difference between 2007 and 2008 2007-2008 -13.333333 17.865547 5-0.7463154 0.2445 Hypothesis test results: Bank Robberies μ 1 - μ 2 : mean of the paired difference between 2008 and 2009 2008-2009 16.833334 18.59286 5 0.90536547 0.7966 The team performed a series of paired T-tests for the data collected on number of bank robberies. Each hypothesis test resulted in a. This means we cannot reject the null (that bankruptcies do not change between each 2 year period). There could be some change, but we did not have sufficient evidence to prove bank robberies increased over time.
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 12 Hypothesis test results: Unemployment Rates μ 1 - μ 2 : mean of the paired difference between 2003 and 2004 Tcv = -2.015 2003-2004 0.505 0.07961365 5 6.3431334 0.9993 Hypothesis test results: Unemployment Rates μ 1 - μ 2 : mean of the paired difference between 2004 and 2005 2004-2005 -0.31666666 0.4349074 5-0.7281244 0.2496 Hypothesis test results: Unemployment Rates μ 1 - μ 2 : mean of the paired difference between 2005 and 2006 2005-2006 0.55833334 0.45444778 5 1.2285974 0.8631 Hypothesis test results: Unemployment Rates μ 1 - μ 2 : mean of the paired difference between 2006 and 2007 2006-2007 -0.046666667 0.08781293 5-0.53143275 0.3089
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 13 Hypothesis test results: Unemployment Rates μ 1 - μ 2 : mean of the paired difference between 2007 and 2008 2007-2008 -0.98833334 0.28680328 5-3.4460323 0.0092 REJECT Hypothesis test results: Unemployment Rates μ 1 - μ 2 : mean of the paired difference between 2008 and 2009 2008-2009 -2.7866666 0.19067715 5-14.61458 <0.0001 REJECT The team performed a series of paired T-tests for the data collected on unemployment rates, as well. The hypothesis test could not be rejected for intervals from 2003 to 2007. This means there was not sufficient evidence to prove that unemployment rates changed over this time. From 2007-2008 and 2008-2009, hypothesis tests resulted in rejecting the hypothesis. This means unemployment rates probably did change during these 2 year periods, but we cannot determine if they increased or decreased, as we performed a one sided test. This is most likely because of NH, as you can see in the unemployment graph; NH s unemployment varies from the normal distribution from 2007 to 2009. Contingency table results: Bank Robberies Statistic DF Value P-value Chi-square 30 106.38439 <0.0001 CRITICAL VALUE: 43.7773 REJECT Comment [N5]: A one-sided test would tell you if it increased or decreased. In your case since you are assuming U1 - U2 < 0 it implies that U1 is less than U2. A rejection of the null implies that U1 is less than U2. However, I doubt if the program you used to do the test actually did a one sided test. So unless you compared to the CV your self it was a twosided test and your alternative hypothesis should have been stated as a two-sided test U1 U2 <> 0
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 14 Contingency table results: Unemployment Rates Statistic DF Value P-value Chi-square 30 2.7876186 1 Contingency table results: Bankruptcy Filings Statistic DF Value P-value Chi-square 30 1715.481 <0.0001 REJECT Chi-square analyses for bank robberies, unemployment and bankruptcy filings, were conducted to determine if these values were independent of year and state. For bank robberies and bankruptcy, the chi-square test result was to reject the null. This means these values are not independent of year and state. In contrast, unemployment rates were independent of year and state. Simple linear regression results: Dependent Variable: Bank Robberies Independent Variable: Unemployment % Bank Robberies = 44.650345 + 4.1325645 Unemployment % Sample size: 42 R (correlation coefficient) = 0.0719 R-sq = 0.0051705735 Estimate of error standard deviation: 89.67284 Parameter estimates: Parameter Estimate Std. Err. Alternative DF T-Stat P-Value Intercept 44.650345 49.827812 0 40 0.8960929 0.3756 Slope 4.1325645 9.063472 0 40 0.45595822 0.6509 Analysis of variance table for regression model: Source DF SS MS F-stat P-value Model 1 1671.7522 1671.7522 0.20789789 0.6509 Error 40 321648.72 8041.2183 Total 41 323320.47
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 15 H 0 : B = 0 H a : B 0 The linear regression test resulted in a P value of 0.6509 therefore the null hypothesis is not rejected. Our findings reflect that there is no relationship between unemployment and bank robberies. Discussion/Conclusion The point of this research was to determine if there is a relationship between the number of bank robberies and the economic factors of unemployment rates and bankruptcy filings. Our hypothesis was that increased unemployment and bankruptcy would result in increased prevalence of bank robberies. We believe the recent economy has declined and the number of bank robberies reported in the media has increased. The paired-t test disproved an upward trend in bank robberies. There was no significance in unemployment, either, until 2007, where it remained significant in 2 year periods until 2009. This is consistent with our observation of increased unemployment in recent years.
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 16 Our linear regression test tested for correlation between unemployment rates and number of bank robberies. After performing the test, we determined there is no correlation between these two variables based on the evidence presented. Therefore, all of our testing has proven our initial hypothesis was incorrect---there is no notable relationship between bank robberies and unemployment/bankruptcy based on the data we collected and analyzed.
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 17 References Agee Sara, (2006)- M&M Math Science Buddies retrieved December 13, 2010 www.sciencebuddies.org Federal Bureau of Investigation Bank Crime Reports. (2003-2009) Retrieved October 10 2010, www.fbi.gov/stats-services/publications New England Unemployment Statistics. (2003-2009) Retrieved October 20, 2010 www.dlt.ri.gov/lmi/laus/us/neadj.htm Rhode Island State Courts, Bankruptcy Statistics. (2003-2009.) Retrieved November 2, 2010 from www.rib.uscourts.gov/docs Schiffman, Barry. (1985, April 26). Unfruitful crime. Wall Street Journal (Eastern Edition), p. 1. Retrieved December 13, 2010, from ABI/INFORM Global. (Document ID: 7497491). State of Maine Bankruptcy Statistics. (2003-2009). Retrieved November 12, 2010 from http://www.meb.uscourts.gov/pdf/web_stats_2002.pdf United States Bureau of Economic Development. (2003-2009). Retrieved October 2, 2010 from http://www.bea.gov/regional/ United States Local Area Unemployment Statistics. (LAUS). (2003-2009). Retrieved November 20, 2010 from http://www.bls.gov/lau/ United States Economic Summaries by States. (2003-2009). Retrieved November 20, 2010 from http://www.bos.frb.org/economic/neei/neei.htm United States Department of Labor Statistics. New England Information Office. (2003-2009) Release Date September 28, 2010 Retrieved October 20, 2010 from http://www.bls.gov/ro1/unempne.htm United States, State Population. (2003-2009.) Retrieved October 10 2010, from http://www.census.gov/
THE ECONOMICS OF BANK ROBBERIES IN NEW ENGLAND 18 Zara, Georgia; Farrington, David P.. Criminal Behaviour & Mental Health, Oct2010, Vol. 20 Issue 4, p257-273, 17p, 6 Charts, 2 Graphs; Retrieved December 13, 2010 DOI: 10.1002/cbm.763