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Crime rates, male youth unemployment and real income in Australia: evidence from Granger causality tests

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  • Paresh Kumar Narayan
  • Russell Smyth

Abstract

This article applies Granger causality tests to examine the relationship between seven different categories of property crime and violent crime against the person, male youth unemployment and real male average weekly earnings in Australia from 1964 to 2001 within a cointegration and vector error correction framework. It is found that fraud, homicide and motor vehicle theft are cointegrated with male youth unemployment and real male average weekly earnings. However, there is no evidence of a long-run relationship between either break and enter, robbery, serious assault or stealing with male youth unemployment and real male average weekly earnings.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Applied Economics.

Volume (Year): 36 (2004)
Issue (Month): 18 ()
Pages: 2079-2095

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Handle: RePEc:taf:applec:v:36:y:2004:i:18:p:2079-2095

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  1. Richard B. Freeman, 1982. "Crime and the Labor Market," NBER Working Papers 1031, National Bureau of Economic Research, Inc.
  2. Gregory, A.W. & Hansen, B.E., 1992. "Residual-Based Tests for Cointegration in Models with Regime Shifts," RCER Working Papers 335, University of Rochester - Center for Economic Research (RCER).
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  4. Tuck Cheong Tang & Mahendhiran Nair, 2002. "A cointegration analysis of Malaysian import demand function: reassessment from the bounds test," Applied Economics Letters, Taylor & Francis Journals, vol. 9(5), pages 293-296.
  5. Reilly, Barry & Robert Witt, 1992. "Crime, deterrence and unemployment in England and Wales: an empirical analysis," Discussion Papers in Economics 12/92, Department of Economics, University of Sussex.
  6. Raphael, Steven & WINTER-EBMER, RUDOLF, 1998. "Identifying the Effect of Unemployment on Crime," University of California at San Diego, Economics Working Paper Series qt5hb4h56g, Department of Economics, UC San Diego.
  7. M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
  8. Pesaran, M.H. & Shin, Y., 1995. "An Autoregressive Distributed Lag Modelling Approach to Cointegration Analysis," Cambridge Working Papers in Economics 9514, Faculty of Economics, University of Cambridge.
  9. Fiona Carmichael & Robert Ward, 2000. "Youth unemployment and crime in the English regions and Wales," Applied Economics, Taylor & Francis Journals, Taylor & Francis Journals, vol. 32(5), pages 559-571.
  10. Richard B. Freeman, 1994. "Crime and the Job Market," NBER Working Papers 4910, National Bureau of Economic Research, Inc.
  11. Richard B. Freeman, 1991. "Crime and the Employment of Disadvantaged Youths," NBER Working Papers 3875, National Bureau of Economic Research, Inc.
  12. Borland, Jeff & Hunter, Boyd, 2000. "Does Crime Affect Employment Status? The Case of Indigenous Australians," Economica, London School of Economics and Political Science, London School of Economics and Political Science, vol. 67(265), pages 123-44, February.
  13. Bruce Chapman & D. Weatherburn & C.A. Kapuscinski & M. Chilvers & S. Roussel, 2002. "Unemployment Duration, Schooling and Property Crime," CEPR Discussion Papers 447, Centre for Economic Policy Research, Research School of Economics, Australian National University.
  14. Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, Econometric Society, vol. 55(2), pages 251-76, March.
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Cited by:
  1. Halicioglu, Ferda & Andrés, Antonio R. & Yamamura, Eiji, 2012. "Modeling crime in Japan," Economic Modelling, Elsevier, vol. 29(5), pages 1640-1645.
  2. Tang, Chor Foon & Lean, Hooi Hooi, 2009. "New evidence from the misery index in the crime function," Economics Letters, Elsevier, vol. 102(2), pages 112-115, February.
  3. Ferda Halicioglu, 2012. "Temporal causality and the dynamics of crime in Turkey," International Journal of Social Economics, Emerald Group Publishing, vol. 39(9), pages 704-720, July.
  4. Claudio Detotto & Manuela Pulina, 2013. "Does more crime mean fewer jobs and less economic growth?," European Journal of Law and Economics, Springer, vol. 36(1), pages 183-207, August.
  5. Baharom, A.H. & Habibullah, M.S., 2008. "Is crime cointegrated with income and unemployment?: A panel data analysis on selected European countries," MPRA Paper 11927, University Library of Munich, Germany.
  6. Chang, Yu-Hern & Chang, Yu-Wei, 2009. "Air cargo expansion and economic growth: Finding the empirical link," Journal of Air Transport Management, Elsevier, vol. 15(5), pages 264-265.
  7. Mustard, David B., 2010. "How Do Labor Markets Affect Crime? New Evidence on an Old Puzzle," IZA Discussion Papers 4856, Institute for the Study of Labor (IZA).
  8. Kollias, Christos & Mylonidis, Nikolaos & Paleologou, Suzanna-Maria, 2013. "Crime and the effectiveness of public order spending in Greece: Policy implications of some persistent findings," Journal of Policy Modeling, Elsevier, vol. 35(1), pages 121-133.
  9. Nikolaos Dritsakis & Alexandros Gkanas, 2009. "The effect of socio-economic determinants on crime rates: An empirical research in the case of Greece with cointegration analysis," International Journal of Economic Sciences and Applied Research (IJESAR), Technological Educational Institute (TEI) of Kavala, Greece, vol. 2(2), pages 51-64, December.

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