Study: When retail stores close down, neighborhood crime goes up

Activist, author, and urban theorist Jane Jacobs’s famous concept of eyes on the street—that active, lively mixed-use communities are safer and more stable due to constant observation and activity from neighbors—found support recently from a detailed study of restaurants and retail stores. And it all started with a study of California marijuana dispensaries.

According to a study by Tom Chang and Mireille Jacobson that was published in the Journal of Urban Economics—”Going to pot? The impact of dispensary closures on crime”—when retail businesses close, the neighborhood not only loses jobs. The area also loses a key crime prevention tool. According to Chang and Jacobson’s research, each open retail business provided over $30,000 annually in social benefit just in terms of the theft it prevented.

How did we go from pot to eyes on the street? At first, the researchers looked solely at medical marijuana dispensaries to see if closing them down lowered crime, and supported the view of opponents that these types of businesses are negative crime magnets for the community. In 2010, LA shuttered hundreds of dispensaries in a mass closing, giving the researchers a perfect test case. Their research showed the exact opposite of what was expected; when dispensaries closed, crime went up. And perhaps most tellingly, the type of crime that decreased was of the type that would be most deterred by a busy street: property crime and theft from vehicles.

When they shared their research with colleagues, one suggested they look into other businesses and retail to see if they could find the same results. They looked at hundreds of LA-area restaurants and found the same thing.

The area immediately around a closed restaurant experienced an increase in property crime and theft from vehicles, relative to areas around restaurants that were either recently reopened or about to be closed. Furthermore, this increase in crime disappeared as soon as the restaurant reopened.

“It does say there’s an overlooked positive impact of having certain kinds of commercial activity,” says Jacobson. “People focus a lot on the potential crime that they expect comes from a particular business, and overlook the benefits.”

The researchers even checked walkability to further verify their thesis. When they accentuated their analysis with walk scores—a measure of an area’s walkability as determined by the number of nearby restaurants, coffee shops, grocery stores, and other features that generate foot traffic—they discovered that “the increase in crime associated with business closures was stronger in neighborhoods with less walkability and fewer other businesses around.”

Jacobson was quick to note that they are far from the first people to write about Jacobs’s ideas. But by connecting her keen observations with a pair of detailed crime analyses, they were able to provide some of the first rigorous empirical evidence of the connection.