Crime and the Labor Market in a Search Model with Pairwise-Efficient Separations
This paper extends the Pissarides (2000) model of the labor market to include crime and punishment Ã la Becker (1968). All workers, irrespective of their labor force status can commit crimes and the employment contract is determined optimally. The model is used to study, analytically and quantitatively, the effects of various labor market and crime policies. For instance, a more generous unemployment insurance system reduces the crime rate of the unemployed but its effect on the crime rate of the employed depends on job duration and jail sentences. When the model is calibrated to U.S. data, the overall effect on crime is positive but quantitatively small. Wage subsidies reduce unemployment and crime rates of employed and unemployed workers, and improve society's welfare. Hiring subsidies reduce unemployment but they can raise the crime rate of employed workers. Crime policies (police technology and jail sentences) affect crime rates significantly but have only negligible effects on the labor market.
|Date of creation:||01 Aug 2007|
|Date of revision:|
|Contact details of provider:|| Postal: 2127 North Hall, Santa Barbara, CA 93106-9210|
Phone: (805) 893-3670
Fax: (805) 893-8830
Web page: http://www.escholarship.org/repec/ucsbecon_dwp/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dale T. Mortensen & Christopher A. Pissarides, 1993.
"Job Creation and Job Destruction in the Theory of Unemployment,"
CEP Discussion Papers
dp0110, Centre for Economic Performance, LSE.
- Dale T. Mortensen & Christopher A. Pissarides, 1994. "Job Creation and Job Destruction in the Theory of Unemployment," Review of Economic Studies, Oxford University Press, vol. 61(3), pages 397-415.
- Mortensen, Dale & Pissarides, Christopher, 2011. "Job Creation and Job Destruction in the Theory of Unemployment," Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 1, pages 19 pages.
- Joseph A. Ritter & Lowell J. Taylor, 1997.
"Economic models of employee motivation,"
1997-006, Federal Reserve Bank of St. Louis.
- Marcus Hagedorn & Iourii Manovskii, 2008.
"The Cyclical Behavior of Equilibrium Unemployment and Vacancies Revisited,"
American Economic Review,
American Economic Association, vol. 98(4), pages 1692-1706, September.
- Hagedorn, Marcus & Manovskii, Iourii, 2008. "The cyclical behavior of equilibrium unemployment and vacancies revisited," Working Paper Series 0853, European Central Bank.
- Marcus Hagedorn & Iourii Manovskii, 2005. "The Cyclical Behavior of Equilibrium Unemployment and Vacancies Revisited," 2005 Meeting Papers 460, Society for Economic Dynamics.
- Marcus Hagedorn & Iourii Manovskii, 2007. "The Cyclical Behavior of Equilibrium Unemployment and Vacancies Revisited," IEW - Working Papers 351, Institute for Empirical Research in Economics - University of Zurich.
- Holmlund, B., 1997.
"Unemployment Insurance in Theory and Practice,"
CEPR Discussion Papers
380, Centre for Economic Policy Research, Research School of Economics, Australian National University.
- Gary S. Becker, 1968.
"Crime and Punishment: An Economic Approach,"
Journal of Political Economy,
University of Chicago Press, vol. 76, pages 169.
- Arthur J. Hosios, 1990. "On The Efficiency of Matching and Related Models of Search and Unemployment," Review of Economic Studies, Oxford University Press, vol. 57(2), pages 279-298.
- Christopher A. Pissarides, 1992. "Loss of Skill During Unemployment and the Persistence of Employment Shocks," The Quarterly Journal of Economics, Oxford University Press, vol. 107(4), pages 1371-1391.
- Grogger, Jeff, 1998.
"Market Wages and Youth Crime,"
Journal of Labor Economics,
University of Chicago Press, vol. 16(4), pages 756-91, October.
- Christopher A. Pissarides, 2000. "Equilibrium Unemployment Theory, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262161877, March.
- Bonilla Roberto & Burdett Kenneth, 2010. "On-the-Job Search and Labor Market Equilibrium," The B.E. Journal of Macroeconomics, De Gruyter, vol. 10(1), pages 1-28, March.
- Ken Burdett & Melvyn Coles, 2003. "Equilibrium Wage-Tenure Contracts," Econometrica, Econometric Society, vol. 71(5), pages 1377-1404, 09.
- Olivier Marie & Stephen Machin, 2004. "Crime And Benefit Cuts," Royal Economic Society Annual Conference 2004 134, Royal Economic Society.
- Bedard, Kelly & Helland, Eric, 2004.
"The location of women's prisons and the deterrence effect of "harder" time,"
International Review of Law and Economics,
Elsevier, vol. 24(2), pages 147-167, June.
- Kelly Bedard & Eric Helland, . "The Location of Women's Prisons and the Deterrence Effect of 'Harder' Time," Claremont Colleges Working Papers 2000-06, Claremont Colleges.
- Stephen Machin & Costas Meghir, 2000.
"Crime and economic incentives,"
IFS Working Papers
W00/17, Institute for Fiscal Studies.
- Hoon, H.T. & Phelps, E.S., 1998. "Low-Wage Employment Subsidies in a Labor-Turnover Model of the 'Natural Rate'," Papers 98-004, Indiana - Center for Econometric Model Research.
- Christopher A. Pissarides, 1994. "Search Unemployment with On-the-job Search," Review of Economic Studies, Oxford University Press, vol. 61(3), pages 457-475.
- Robert Shimer, 2005. "The Cyclical Behavior of Equilibrium Unemployment and Vacancies," American Economic Review, American Economic Association, vol. 95(1), pages 25-49, March.
- Marco Cozzi, 2007. "Hard Drugs Addiction, Drug Violations and Property Crimes in the US," 2007 Meeting Papers 51, Society for Economic Dynamics.
- E. Paul Durrenberger, 2005. "Labour," Chapters, in: A Handbook of Economic Anthropology, chapter 8 Edward Elgar Publishing.
When requesting a correction, please mention this item's handle: RePEc:cdl:ucsbec:qt72r6g75d. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Lisa Schiff)
If references are entirely missing, you can add them using this form.