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The Effect of Education on Crime: Evidence from Prison Inmates, Arrests, and Self-Reports

  • Lance Lochner
  • Enrico Moretti

We estimate the effect of education on participation in criminal activity using changes in state compulsory schooling laws over time to account for the endogeneity of schooling decisions. Using Census and FBI data, we find that schooling significantly reduces the probability of incarceration and arrest. NLSY data indicate that our results are caused by changes in criminal behavior and not differences in the probability of arrest or incarceration conditional on crime. We estimate that the social savings from crime reduction associated with high school graduation (for men) is about 14 -26 percent of the private return.

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/000282804322970751
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Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 94 (2004)
Issue (Month): 1 (March)
Pages: 155-189

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Handle: RePEc:aea:aecrev:v:94:y:2004:i:1:p:155-189
Note: DOI: 10.1257/000282804322970751
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  1. 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.
  2. Steven D. Levitt, 1995. "Using Electoral Cycles in Police Hiring to Estimate the Effect of Policeon Crime," NBER Working Papers 4991, National Bureau of Economic Research, Inc.
  3. Steven D. Levitt, 1997. "Juvenile Crime and Punishment," NBER Working Papers 6191, National Bureau of Economic Research, Inc.
  4. Mustard, David B, 2001. "Racial, Ethnic, and Gender Disparities in Sentencing: Evidence from the U.S. Federal Courts," Journal of Law and Economics, University of Chicago Press, vol. 44(1), pages 285-314, April.
  5. Joshua D. Angrist & Guido W. Imbens, 1995. "Identification and Estimation of Local Average Treatment Effects," NBER Technical Working Papers 0118, National Bureau of Economic Research, Inc.
  6. James Heckman, 1997. "Instrumental Variables: A Study of Implicit Behavioral Assumptions Used in Making Program Evaluations," Journal of Human Resources, University of Wisconsin Press, vol. 32(3), pages 441-462.
  7. W. Kip Viscusi, 1986. "Market Incentives for Criminal Behavior," NBER Chapters, in: The Black Youth Employment Crisis, pages 301-351 National Bureau of Economic Research, Inc.
  8. Gary S. Becker & Casey B. Mulligan, 1997. "The Endogenous Determination of Time Preference," The Quarterly Journal of Economics, Oxford University Press, vol. 112(3), pages 729-758.
  9. Edward L. Glaeser & Bruce Sacerdote & José A. Scheinkman, 1996. "Crime and Social Interactions," The Quarterly Journal of Economics, Oxford University Press, vol. 111(2), pages 507-548.
  10. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863 Elsevier.
  11. Bekker, Paul A, 1994. "Alternative Approximations to the Distributions of Instrumental Variable Estimators," Econometrica, Econometric Society, vol. 62(3), pages 657-81, May.
  12. Daron Acemoglu & Joshua Angrist, 2001. "How Large are Human-Capital Externalities? Evidence from Compulsory-Schooling Laws," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 9-74 National Bureau of Economic Research, Inc.
  13. Yitzhaki, Shlomo, 1996. "On Using Linear Regressions in Welfare Economics," Journal of Business & Economic Statistics, American Statistical Association, vol. 14(4), pages 478-86, October.
  14. Witte, Ann D & Tauchen, Helen, 1994. "Work and Crime: An Exploration Using Panel Data," Public Finance = Finances publiques, , vol. 49(Supplemen), pages 155-67.
  15. Ann Dryden Witte & Helen Tauchen, 1994. "Work and Crime: An Exploration Using Panel Data," NBER Working Papers 4794, National Bureau of Economic Research, Inc.
  16. Tauchen, Helen & Witte, Ann Dryden & Griesinger, Harriet, 1994. "Criminal Deterrence: Revisiting the Issue with a Birth Cohort," The Review of Economics and Statistics, MIT Press, vol. 76(3), pages 399-412, August.
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