Explain the meaning of 'endogenous' as used in this contex: "policing and crime are endogenous to unobservable strategic interaction"?
Solution 1:
The definition you provided makes sense to me, even if I find the rest of the sentence somewhat suspect.
To paraphrase the part in question:
Policing and crime are [internal factors of] unobservable strategic interaction.
Assuming that no mistake was made, then the author is saying that police deployment and enforcement strategies are both things that are observable, but strategic interaction is not something that's observable—and that policies around policing and crime make up and dictate (endogenously) this unobservable strategic interaction.
However, I find the particular use of terms to be questionable. I would consider strategic interaction to be just as visible as police deployment and enforcement strategies. It would only be the policies behind all of that that could not be observed.
In short, I think the following is what the passage is actually intending to say:
The hidden policies that make up and dictate the policing of crime are not apparent to the casual observer of visible police-suspect interaction. Many people can't understand why police act as they do in some situations, and so they either follow the law or commit crime purely on the basis of their reactions to what they observe to be happening and on their assumptions about the reasoning behind it.
Solution 2:
From Lexico:
endogenous: having an internal cause or origin
Let X stand for "unobservable strategic interaction".
As per Lexido, "endogenous to X" means "having an internal cause or origin" in X.
From this it follows that "policing and crime" have an internal cause or origin in X.
That "policing and crime" have an internal cause or origin in X "frustrates causal analysis" because one can't perform a causal analysis based on unobservable interactions.
Fundamentally, the causes and origins of both crime and society's reaction to crime through policing are not "observable" by ordinary citizens, i.e., by those who are neither committing (or considering committing) crimes nor developing and implementing law-enforcement strategies.
Solution 3:
I hope the author isn't trying to use endogenous the way economists use the word because that would make the statement just plain wrong. You can't have something endogenous to an "unobservable" anything. By definition, the causal structure must be explicit as far as internal dependencies are concerned. That is basically the point you are making when you use the word.
Definition:
Endogenous variables designates variables in an economic/econometric model that are explained, or predicted, by that model.
https://stats.oecd.org/glossary/detail.asp?ID=794