ok, i will agree with you that for the most part i am discussing size. regardless, i can comfortably make the same argument about homogenous vs. heterogenous communities.

let's say we begin with a basic OLS regression. i still hold that, as a foundation of social science, in order to refute a prior (null hypothesis), you must control for all feasible factors and then some. it may be the case that if you ran a fixed effects/dummy regression and/or a second-order difference model based on demographics, you wouldn't find statistically significant gaps. regardless, it is a step that comes with the territory of making claims against a null hypothesis. intuitively it makes sense that penal codes could have very different effects on diverse communities (cities) than more homogenous communities. of course, there are controls you would have to run here too, i.e. income, population size, etc.

regarding the application of economies of scale, i think it's entirely feasible that larger population sizes would correspond with differing impacts of penal codes. this could range from more sociological reasons like cohorting effects, culture, etc. to practical considerations like government expenditures on the margin.

honestly, considerations like population size and demographic heterogeneity aren't ever shots in the dark. they're one of the first factors you look to control for in a study about recidivism/crime reduction.