PROFITING FROM TRAGEDY

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    PROFITING FROM TRAGEDY: AN EMPIRICAL INVESTIGATION ON MASS

    SHOOTINGS AND GUN ACQUISITION

    BY

    Everett Brandon Price

    Submitted to Princeton University

    Department of Economics

    In Partial Fulfillment of the Requirements for the A.B. Degree

    April 13, 2016

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    Table of Contents

    Introduction .. 3

    Literature Review . 10

    Data ... 33

    Methodology ..38

    Results 49

    Conclusion .56

    Tables and Figures .60

    Bibliography.. 69

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    I. Introduction

    On the morning of December 2, 2015, Syed Rizwan Farook and his wife Tashfeen Malik

    opened fire at a social services facility in San Bernardino, California, killing fourteen people and

    injuring an additional twenty-one1. It was the deadliest mass shooting since the 2012 Sandy

    Hook Elementary School shooting where Adam Lanza fatally shot twenty children and six

    faculty members. Mass shootings like these are occurring more frequently in the United States

    than ever before. Although there is no broadly accepted definition of a mass shooting, most

    academic studies define mass shootings as events where an individual kills four or more people

    in a single incident (not including himself), typically in a single location2. Using this definition,

    a recent study by Harvard Research suggests that the rate of mass shootings has tripled since

    20113. While there seems to be a consensus among scholars that mass shootings are on the rise,

    there is anything but a consensus on how to prevent these tragedies from occurring in the future.

    In the aftermath of these events, public discourse often focuses on the role of gun

    legislation--or lack thereof--in the occurrence of mass shootings. While some argue that stricter

    gun control will decrease the frequency of mass shootings, others contend that gun ownership

    has a chilling effect on these incidents. In a nut shell, the United States is once again divided on

    whether guns are seen as a problem or a solution. Although there is a wealth of research devoted

    to the relationship between gun ownership and gun violence, scholars acknowledge that the

    results of these studies vary widely and do not offer any conclusive evidence on the effectiveness

    of gun control on crime and public safety4. Despite the fact that household gun ownership has

    1 http://www.cnn.com/2015/12/06/us/san-bernardino-shooting-what-we-know/

    2 http://www.motherjones.com/politics/2015/12/no-there-were-not-355-mass-shootings-this-year

    3 http://www.hsph.harvard.edu/news/hsph-in-the-news/mass-shootings-becoming-more-frequent/

    4 https://www.washingtonpost.com/news/wonk/wp/2014/11/14/more-guns-more-crime-new-research-debunks-

    a-central-thesis-of-the-gun-rights-movement/

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    been steadily declining in recent decades, the number of guns in circulation has risen

    dramatically since Obama took in office in 20085. The United States now has more guns than it

    has people -- a feat no other country is even close to6. The Congressional Research Service

    estimates that there are 40 million more guns than people in the US, not including the number of

    illegal guns in the country.

    Regardless of how you measure it, Americans are purchasing more guns than ever before.

    The National Instant Criminal Background Check System (NICS) is a system used by Federal

    Firearms Licensees (FFLs) to instantly determine whether a prospective buyer is eligible to buy

    firearms7. Because there is not an officially reported statistic for guns sales, NICS background

    checks are the most common proxy for gun sales. While the number of background checks has

    been increasing dramatically for the last decade (see Figure 1), firearms manufacturers and

    distributors have also been reporting record revenues and profits8(see Figure 2). Consequently,

    gun stocks have continued to soar at a time when the rest of the economy has seemed to stall out.

    As the number of guns in this country continues to increase, so does the rate of mass shootings.

    While some deem this to be a mere coincidence, advocates of tighter gun regulation strongly

    believe that the rise in mass shootings stems from the easy access to guns in this country9.

    Although the relationship between gun ownership and gun-related deaths has been well-

    documented over the years, there is much less research on the link between gun ownership and

    mass shootings in particular.

    5 http://www.norc.org/PDFs/GSS%20Reports/GSS_Trends%20in%20Gun%20Ownership_US_1972-2014.pdf

    6 https://www.washingtonpost.com/news/wonk/wp/2015/10/05/guns-in-the-united-states-one-for-every-man-

    woman-and-child-and-then-some/ 7 https://www.fbi.gov/about-us/cjis/nics

    8 http://www.economist.com/blogs/graphicdetail/2015/08/graphics-americas-guns

    9 http://www.nytimes.com/interactive/2015/10/07/us/gun-control-explained.html

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    In light of the conflicting views over the role that guns play in these tragic incidents, my

    thesis challenges the common belief that mass shootings are the product of there being more

    guns in the United States than in previous years. Using data on mass shootings, background

    checks, and the revenues of gun companies, my study takes an empirical approach in examining

    the unique relationship between gun sales and mass shootings. While this paper does not attempt

    to identify the root cause of the recent uptick in mass shootings, the results of my analysis

    support anecdotal evidence that mass shootings cause spikes in gun sales. More importantly, my

    study extends on the research of Wallace (2015) by looking at the quarterly revenues of gun

    companies in addition to monthly background checks10

    .

    The issue of gun control continues to be one of the most controversial and debated topics

    in politics. President Obama has made numerous calls for more comprehensive background

    checks and the banning of assault weapons and high-capacity magazines11

    . After the San

    Bernardino attack, he addressed the nation: The one thing we do know is that we have a pattern

    now of mass shootings in this country that has no parallel anywhere else in the world. And there

    are some steps we could take not to eliminate every one of these mass shootings, but to improve

    the odds that they don't happen as frequently: common-sense gun safety laws, stronger

    background checks12

    .

    Although many lauded Obamas plan to curtail the circulation of firearms in the US,

    there was strong opposition from the NRA and other gun rights advocates who saw this as a

    violation of their Second Amendment rights. This clash between Obama and gun rights

    advocates has become routine in the wake of high-profile mass shootings. On the one hand,

    10

    Lacey Wallace, Responding to violence with guns: Mass shootings and gun acquisition (Penn State 2015) 11

    https://www.washingtonpost.com/politics/obama-launches-gun-violence-task-force/2012/12/19/90ff2d52-49f9-11e2-b6f0-e851e741d196_story.html 12

    https://www.whitehouse.gov/blog/2015/12/02/president-obama-shooting-san-bernardino

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    defenders of the Second Amendment object that more guns do not necessarily lead to more mass

    shootings. After all, most of us have heard the saying: Guns dont kill people, people do. Some

    gun-owning Americans claim that guns can prevent mass shootings or at least mitigate the

    carnage. Even if it is unlikely that a mass shooter is stopped in the act by an armed civilian, there

    are some who contend that the mere presence of guns dissuades people from committing crimes

    in the first place. They argue that owning a firearm and being trained in how to use it can make a

    household or community safer. The fact that 60% of Americans say they own a gun for personal

    safety/protection purposes supports this belief13

    . Considering that mass shootings have not

    subsided, it is understandable why some Americans might view buying a gun as a step closer to

    peace of mind.

    Despite Obamas multiple calls for tighter gun control, bills expanding background

    checks were not able to make it through Congress. While there has not been any gun control

    legislation passed at the federal level, certain states have taken measures into their own hands. In

    a recent study on gun laws during the 20042014 period, Kristin Goss finds that 48 out of the 50

    states introduced legislation on guns and mental health and the majority (n = 26) both tightened

    and loosened restrictions over the period (sometimes in the same bill)14. That is, there were bills

    passed which contained provisions both tightening and relaxing certain aspects of gun control.

    Her study suggests that nationally prominent shootings were directly responsible for the creation

    of 39% of the firearms and mental health bills in her sample15

    . While the introduction of stricter

    gun legislation is expected after a mass shooting, it is surprising to see that there is also

    legislation passed which expands the rights of gun owners. Gosss findings challenge the

    13

    http://www.gallup.com/poll/1645/guns.aspx 14

    Kristin Goss, Defying the odds on gun regulation: The p