Discuss the econometric problems that prevent the identification of the causal effect of interest in a simple OLS framework. Outline the empirical strategies used to tackle these econometric problems.

Economics of Crime

Can changes in sentence severity affect crime rates? Justify your answer. Discuss the econometric problems that prevent the identification of the causal effect of interest in a simple OLS framework. Outline the empirical strategies used to tackle these econometric problems. Critically discuss the identification strategies and the findings of the related studies presented during the module. Draw conclusions in your answer on whether, how, and to what extent, changes in sentence severity can affect criminal activity.