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The setting of Crime and Punishment creates an atmosphere in which the dreadful crimes Dostoevsky describes are all too believable. The novel is set in Haymarket Square, a slum section of St. Petersburg notorious for its intolerable living conditions. Because he knew the city so well, and had lived in the kinds of tenement rooms he describes, Dostoevsky is very specific about the sights and smells his characters experience.
By choosing to set the novel in the summer, when the drunken crowds filled the streets and the air reeked, Dostoevsky was able to create the feelings of physical repulsion brought on by an oppressive environment. By mentioning particular street names and tracing the routes of the characters, he was emphasizing the novel's realism. Raskolnikov knows, for instance, that it is exactly 730 steps from his house to the pawnbroker's. Even today, you can walk the route he followed and count the steps. When the physical details are concrete, you tend to accept the rest of the information in the novel too; even the most bizarre things seem believable.
Crime was a very real problem in Russia at the time the novel was written. An especially gruesome ax murder of two old women in Moscow in the summer of 1865 had gotten enormous play in the press, and Dostoevsky clearly had it in mind as he formulated his novel. Drunkenness and prostitution were commonplace, and the gap between the middle class and the poor was enormous. By documenting these facts of life, Dostoevsky provides social history-and even social protest-as part of his study of Raskolnikov's character.
When the scene shifts to Siberia, in the Epilogue, the physical change signals an enormous change in subject matter as well. The transformation of Raskolnikov's character, from arrogant to penitent, happens in the stark, repressive atmosphere of a prison camp. When he is physically confined and publicly humiliated, he is finally able to find meaning in life that he could not discover when he was free to act as he chose.
Because the Epilogue is short, and the emphasis is on Raskolnikov's "resurrection," there isn't much detail about life in prison. Dostoevsky's own prison experience was still vivid in his mind a dozen years after his release, but his purpose in this section is not realism, but resolution of his theme of salvation. That is why Raskolnikov's reconciliation-with Sonia and with his own humanity-takes place at Easter, the Christian season of hope.