This paper examines the role of crime, enforcement and taxation on the economic growth. These effects are studied by modified version of an endogenous growth model proposed by Loayza (1996). Econometric results are based on the German economy over the period 1992-2016. Empirical evidence confirms the theoretical model. We show that the relationship between crime and growth rate of GDP is negative in the long run equilibrium.
Keywords: Crime; Economic Growth; Enforcement.