Crime Doesn't Pay (Well): The Economics of Bank Robberies

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Hollywood always makes bank robberies look so easy (with some notable exceptions). You do a little planning, throw on a Richard Nixon mask, you’re in and out in a few minutes and then you can live the rest of your life in luxury in some tropical paradise that won’t extradite you.

A real-world bank job, however, isn’t a one-way ticket to luxury.

As economists Barry Reilly, Neil Rickman and Robert Witt explain in a new study, “The return on an average bank robbery is, frankly, rubbish.”

A UK banking organization asked the three to analyze the economic effectiveness of adding some new security measures to bank branches. As part of that, the guys had a little fun and took a look at the economics of bank robbery from the bad guys’ perspective. Their results are hardly the glamorous kind which movies have taught us to expect.

The first problem is that the typical return on a bank robbery is pretty modest. Over a three-year period, one thing or another went wrong and 1/3 of UK bank robbers got away with no money at all. The average haul for a successful heist was around £30,000 (or about $47,000). Even then, about 1/5 of successful robbers were later caught, arrested and convicted, and in some cases the money recovered.

The economists did discover a few ways that would-be Dillingers could increase their gains. Their data showed that each additional member of a robbery crew raises the expected value of the haul by £9,033.20 (~ $14,216 USD). “A larger gang may have spent more time on planning and reconnoitering,” they write. “In short, it may be more professional, and the larger returns may reflect that.” A large crew has one obvious drawback, though: there are more people that have to split the loot. If the crew divvies out the cash equally, “although the total haul goes up, the haul per person goes down.”

They also found that packing heat has a positive effect on the take, and “the threat of firearm use in a bank raid raises the unconditional expected value of the robbery by £10,300.50 [$16,210 USD],” on average.

No Way to Live

Given the average haul of £30,000 and the average full-time UK employment wage of about £26,000, the economists decided that typical bank robbers are not setting themselves up for a life of luxury. Rather, a heist “will give him a modest life-style for no more than 6 months.” The loss to the bank is so low, they say, that it “is not worth the banks’ while to spend as little as £4,500 per cashier position at every branch on [new security features] to deter [robberies].”

But that’s just a one-time job. What if you made a career of knocking over banks? That introduces a different problem. If someone keeps at it and robs two banks a year to maintain their income, the economists say, the odds of getting caught will increase. After three jobs, or a year and a half, his chance of getting busted is about half. One more job, and he’s very likely in prison, which really wreaks havoc on his earning potential.

“As a profitable occupation,” the study concludes, “bank robbery leaves a lot to be desired.”