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Spatial Crime Patterns and the Introduction of the UK Minimum Wage

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  • Kirstine Hansen
  • Stephen Machin

Abstract

This paper provides an empirical evaluation of whether one can uncover a link between crime and the labour market using a research methodology that is different to that utilized in existing work. We exploit a large regulatory change that was made to the UK labour market when a national minimum wage was introduced in April 1999. This minimum wage introduction provided pay increases for quite a large number of low paid workers. From a theoretical perspective we argue that this wage boost could have altered individual incentives to participate in crime. We then go on to develop empirical tests of this hypothesis comparing spatial crime patterns, measured at police force area level, in the years before and after the introduction of the minimum wage floor. Our empirical study of area‐level crime rates before and after the minimum wage introduction uncovers a statistically significant link between changes in crime and the extent of area low pay before the minimum wage was introduced. Overall our results are in line with the notion that altering wage incentives can affect crime and therefore that there exists a link between crime and the low wage labour market.

Suggested Citation

  • Kirstine Hansen & Stephen Machin, 2002. "Spatial Crime Patterns and the Introduction of the UK Minimum Wage," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(supplemen), pages 677-697, December.
    • Handle: RePEc:bla:obuest:v:64:y:2002:i:supplement:p:677-697
    DOI: 10.1111/1468-0084.64.s.6
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    References listed on IDEAS

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    Cited by:

    1. Olivier Marie, 2005. "Reducing Crime: More Police, More Prisons or More Pay?," CEP Election Analysis Papers 002, Centre for Economic Performance, LSE.
    2. Ryan S. Johnson & Shawn Kantor & Price V. Fishback, 2007. "Striking at the Roots of Crime: The Impact of Social Welfare Spending on Crime During the Great Depression," NBER Working Papers 12825, National Bureau of Economic Research, Inc.
    3. David B. Mustard, 2010. "Labor Markets and Crime: New Evidence on an Old Puzzle," Chapters, in: Bruce L. Benson & Paul R. Zimmerman (ed.), Handbook on the Economics of Crime, chapter 14, Edward Elgar Publishing.
    4. Naci Mocan & Kaj Gittings, 2010. "The Impact of Incentives on Human Behavior: Can We Make it Disappear? The Case of the Death Penalty," NBER Chapters, in: The Economics of Crime: Lessons For and From Latin America, pages 379-418, National Bureau of Economic Research, Inc.
    5. William Harbaugh & Naci Mocan & Michael Visser, 2013. "Theft and Deterrence," Journal of Labor Research, Springer, vol. 34(4), pages 389-407, December.
    6. David Neumark, 2024. "The effects of minimum wages on (almost) everything? A review of recent evidence on health and related behaviors," LABOUR, CEIS, vol. 38(1), pages 1-65, March.
    7. Papps, Kerry L., 2025. "Why Higher Pay Leads to More Crime," IZA Discussion Papers 17989, IZA Network @ LISER.
    8. Mustard, David B., 2010. "How Do Labor Markets Affect Crime? New Evidence on an Old Puzzle," IZA Discussion Papers 4856, IZA Network @ LISER.
    9. Vinoj Abraham, 2012. "The Deteriorating Labour Market Conditions and Crime: An Analysis of Indian States during 2001-2008," Millennial Asia, , vol. 3(2), pages 207-231, July.
    10. Hjalmarsson, Randi & Machin, Stephen & Pinotti, Paolo, 2024. "Crime and the labor market," Handbook of Labor Economics,, Elsevier.
    11. Price V. Fishback & Ryan S. Johnson & Shawn Kantor, 2010. "Striking at the Roots of Crime: The Impact of Welfare Spending on Crime during the Great Depression," Journal of Law and Economics, University of Chicago Press, vol. 53(4), pages 715-740.
    12. Kirstine Hansen & Dylan Kneale, 2013. "Does How You Measure Income Make a Difference to Measuring Poverty? Evidence from the UK," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 110(3), pages 1119-1140, February.
    13. David Metcalf, 2002. "The National Minimum Wage: Coverage, Impact and Future," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(supplemen), pages 567-582, December.
    14. Che, Yi & Xu, Xun & Zhang, Yan, 2018. "Chinese import competition, crime, and government transfers in US," Journal of Comparative Economics, Elsevier, vol. 46(2), pages 544-567.
    15. Faraz Farhidi & Zaeng Mawi, 2022. "Is It Costly to Transition from Fossil Fuel Energy: A Trade-Off Analysis," Energies, MDPI, vol. 15(21), pages 1-15, October.
    16. Mocan Naci & Unel Bulent, 2017. "Skill-Biased Technological Change, Earnings of Unskilled Workers, and Crime," Review of Law & Economics, De Gruyter, vol. 13(3), pages 1-46, November.
    17. Siwach, Garima, 2018. "Unemployment shocks for individuals on the margin: Exploring recidivism effects," Labour Economics, Elsevier, vol. 52(C), pages 231-244.
    18. Patacchini Eleonora & Zenou Yves, 2012. "Urban Crime and Ethnicity," Review of Network Economics, De Gruyter, vol. 11(3), pages 1-32, September.
    19. Fone, Zachary S. & Sabia, Joseph J. & Cesur, Resul, 2023. "The unintended effects of minimum wage increases on crime," Journal of Public Economics, Elsevier, vol. 219(C).
    20. Colin M Mason & Sara Carter & Stephen K Tagg, 2006. "The Effect of the National Minimum Wage on the UK Small Business Sector: A Geographical Analysis," Environment and Planning C, , vol. 24(1), pages 99-116, February.

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