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Shackled labor markets: Bounding the causal effects of criminal convictions in the U.S

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  • Richey, Jeremiah

Abstract

This paper examines the causal effects of criminal convictions on labor market outcomes in young men using U.S. data from the National Longitudinal Survey of Youth 1997 cohort. Unlike previous research in this area which relies on assumptions strong enough to obtain point identification, this paper imposes relatively weak nonparametric assumptions that provide tight bounds on treatment effects. Even in the absence of a parametric model, under certain specifications, a zero effect can be ruled out, though after a bias correction this result is lost. In general the results for the effect on yearly earnings align well with previous findings, though the estimated effect on weeks worked are smaller than in previous findings which focused on the effects of incarceration. The bounds here indicate the penalty from convictions, but not incarceration, lowers weeks worked by at most 1.55 weeks for white men and at most 4 weeks for black men. Interestingly, when those ever incarcerated are removed from the treatment group for black men, there does not appear to be any effect of convictions on earnings or wages but only on weeks worked.

Suggested Citation

  • Richey, Jeremiah, 2015. "Shackled labor markets: Bounding the causal effects of criminal convictions in the U.S," International Review of Law and Economics, Elsevier, vol. 41(C), pages 17-24.
  • Handle: RePEc:eee:irlaec:v:41:y:2015:i:c:p:17-24
    DOI: 10.1016/j.irle.2014.10.003
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    References listed on IDEAS

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    1. Devah Pager, 2003. "The mark of a criminal record," Natural Field Experiments 00319, The Field Experiments Website.
    2. Jeffrey R. Kling, 2006. "Incarceration Length, Employment, and Earnings," American Economic Review, American Economic Association, vol. 96(3), pages 863-876, June.
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    6. Kreider, Brent & Pepper, John V., 2007. "Disability and Employment: Reevaluating the Evidence in Light of Reporting Errors," Journal of the American Statistical Association, American Statistical Association, vol. 102, pages 432-441, June.
    7. Richard B. Freeman, 1991. "Crime and the Employment of Disadvantaged Youths," NBER Working Papers 3875, National Bureau of Economic Research, Inc.
    8. Jeremiah Richey, 2016. "An Odd Couple: Monotone Instrumental Variables and Binary Treatments," Econometric Reviews, Taylor & Francis Journals, vol. 35(6), pages 1099-1110, June.
    9. Keith Finlay, 2009. "Effect of Employer Access to Criminal History Data on the Labor Market Outcomes of Ex-Offenders and Non-Offenders," NBER Chapters,in: Studies of Labor Market Intermediation, pages 89-125 National Bureau of Economic Research, Inc.
    10. Jeffrey R. Kling & David Weiman & Bruce Western, 2001. "The Labor Market Consequences of Incarceration," Working Papers 829, Princeton University, Department of Economics, Industrial Relations Section..
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    More about this item

    Keywords

    Endogeneity; Nonparametric estimation; Criminal convictions;

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General

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