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Crime, unemployment and labor market programs in turbulent times

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  • Nilsson, Anna

    ()
    (Stockholm University)

  • Agell, Jonas

    ()
    (Stockholm University)

Abstract

We exploit the exceptional variation in municipality-level unemployment and spending on labor market programs in Sweden during the 1990s to identify the impact of unemployment and programs on crime. We identify a statistically significant effect of unemployment on the incidence of overall crime, burglary, auto-theft and drug possession. A calculation suggests that the sharp reduction in unemployment during the later 1990s may have reduced burglary and auto-theft with 15 and 20 percent, respectively. After addressing several specification issues, we conclude that there is at best weak evidence that labor market programs – general ones and those specifically targeted to the young – help to reduce crime.

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Bibliographic Info

Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2003:14.

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Length: 31 pages
Date of creation: 14 Oct 2003
Date of revision:
Handle: RePEc:hhs:ifauwp:2003_014

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Keywords: Crime; unemployment; labor market programs; panel data;

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References

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  1. Levitt, Steven D, 1997. "Using Electoral Cycles in Police Hiring to Estimate the Effect of Police on Crime," American Economic Review, American Economic Association, vol. 87(3), pages 270-90, June.
  2. Grogger, Jeff, 1998. "Market Wages and Youth Crime," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 756-91, October.
  3. Richard B. Freeman, 1996. "Why Do So Many Young American Men Commit Crimes and What Might We Do About It?," NBER Working Papers 5451, National Bureau of Economic Research, Inc.
  4. Alan B. Krueger & Jorn-Steffen Pischke, 1995. "A Statistical Analysis of Crime Against Foreigners in Unified Germany," Working papers 95-15, Massachusetts Institute of Technology (MIT), Department of Economics.
  5. Calmfors, Lars & Forslund, Anders & Hemström, Maria, 2002. "Does Active Labour Market Policy Work? Lessons from the Swedish Experiences," Seminar Papers 700, Stockholm University, Institute for International Economic Studies.
  6. Stephen Machin & Costas Meghir, 2004. "Crime and Economic Incentives," Journal of Human Resources, University of Wisconsin Press, vol. 39(4).
  7. Dahlberg, M. & Forslund, A., 1999. "Direct Displacement Effects of Labour Market Programmes: the Case of Sweden," Papers 1999:22, Uppsala - Working Paper Series.
  8. Assar Lindbeck, 1997. "The Swedish Experiment," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1273-1319, September.
  9. 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.
  10. Gary S. Becker, 1968. "Crime and Punishment: An Economic Approach," Journal of Political Economy, University of Chicago Press, vol. 76, pages 169.
  11. Olivier Jean Blanchard & Lawrence F. Katz, 1992. "Regional Evolutions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 23(1), pages 1-76.
  12. Lance Lochner & Enrico Moretti, 2004. "The Effect of Education on Crime: Evidence from Prison Inmates, Arrests, and Self-Reports," American Economic Review, American Economic Association, vol. 94(1), pages 155-189, March.
  13. Eric D. Gould & Bruce A. Weinberg & David B. Mustard, 2002. "Crime Rates And Local Labor Market Opportunities In The United States: 1979-1997," The Review of Economics and Statistics, MIT Press, vol. 84(1), pages 45-61, February.
  14. Freeman, Richard B., 1999. "The economics of crime," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 52, pages 3529-3571 Elsevier.
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Cited by:
  1. Peter Fallesen & Lars Pico Geerdsen & Susumu Imai & Torben Tranaes, 2010. "The Effect of Workfare Policy on Crime," Working Papers 1236, Queen's University, Department of Economics.
  2. Nilsson, Anna, 2004. "Income Inequality and Crime: The Case of Sweden," Research Papers in Economics 2004:3, Stockholm University, Department of Economics.
  3. Paolo Buonanno, 2005. "Crime and labour market opportunities in Italy (1993-2002)," Working Papers 0504, University of Bergamo, Department of Economics.
  4. Dahlberg, Matz & Gustavsson, Magnus, 2005. "Inequality and crime: separating the effects of permanent and transitory income," Working Paper Series 2005:19, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  5. Vittorio, Daniele, 2009. "Organized crime and regional development. A review of the Italian case," MPRA Paper 16547, University Library of Munich, Germany.
  6. Nilsson, Anna, 2004. "Income inequality and crime: The case of Sweden," Working Paper Series 2004:6, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  7. Marcus Dittrich & Gunther Markwardt, 2004. "Arbeitslosigkeit und Kriminalität : eine mögliche "doppelte Dividende" der Arbeitsmarktpolitik?," ifo Dresden berichtet, Ifo Institute for Economic Research at the University of Munich, vol. 11(06), pages 11-17, December.

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