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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


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


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

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.”

Comment [N2]: Don’t use abbreviations


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 non-

violent 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


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


0

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Year

New England State Populations, 2003-2009

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RI

VT

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150

200

250

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Year

N.E. Bank Robberies, 2003-2009

CT

ME

MA

NH

RI

VT


Mean, Median, Mode Summary statistics: Bank Robberies

0

10,000

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1 2 3 4 5

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Year

Bankruptcy Filings, 2003-2009

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Year

Unemployment Rates, 2003-2009

CT

ME

MA

NH

RI

VT

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


Summary statistics: Unemployment Rates

Summary statistics: Bankruptcy Filings

Summary statistics: State Population

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


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


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


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 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

μ1 - μ2 : mean of the paired difference between 2003 and 2004

H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

Tcv = -2.015

DO NOT REJECT



H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

DO NOT REJECT

Difference Sample Diff. Std. Err. DF T-Stat P-value

2003 - 2004 13.666667 11.712292 5 1.1668652 0.8521


2004 - 2005 -0.33333334 3.6757464 5 -0.09068453 0.4656




H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

DO NOT REJECT



H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

DO NOT REJECT



H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

DO NOT REJECT



H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

DO NOT REJECT

The team performed a series of paired T-tests for the data collected on

number of bank robberies. Each hypothesis test resulted in a “DO NOT REJECT.”

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.


2005 - 2006 -5.3333335 8.807825 5 -0.6055222 0.2856


2006 - 2007 17.5 15.903354 5 1.1003969 0.8394


2007 - 2008 -13.333333 17.865547 5 -0.7463154 0.2445


2008 - 2009 16.833334 18.59286 5 0.90536547 0.7966


Hypothesis test results: Unemployment Rates


H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

Tcv = -2.015

DO NOT REJECT



H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

DO NOT REJECT



H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

DO NOT REJECT



H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

DO NOT REJECT


2003 - 2004 0.505 0.07961365 5 6.3431334 0.9993


2004 - 2005 -0.31666666 0.4349074 5 -0.7281244 0.2496


2005 - 2006 0.55833334 0.45444778 5 1.2285974 0.8631


2006 - 2007 -0.046666667 0.08781293 5 -0.53143275 0.3089




H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

REJECT



H0 : μ1 - μ2 = 0

HA : μ1 - μ2 < 0

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

CRITICAL VALUE: 43.7773

REJECT


2007 - 2008 -0.98833334 0.28680328 5 -3.4460323 0.0092


2008 - 2009 -2.7866666 0.19067715 5 -14.61458 <0.0001

Statistic DF Value P-value

Chi-square 30 106.38439 <0.0001

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 two-sided test and your alternative hypothesis should have been stated as a two-sided test – U1 – U2 <> 0


Contingency table results: Unemployment Rates

DO NOT REJECT

Contingency table results: Bankruptcy Filings

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:

Analysis of variance table for regression model:


Chi-square 30 2.7876186 1


Chi-square 30 1715.481 <0.0001

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

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


H0: B = 0

Ha: 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.


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.


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/

http://www.meb.uscourts.gov/Pdf/web_stats_2002.pdf

http://www.bea.gov/regional/

http://www.bls.gov/lau/

http://www.bos.frb.org/economic/neei/neei.htm

http://www.bls.gov/ro1/unempne.htm

http://www.census.gov/


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

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