IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp17958.html
   My bibliography  Save this paper

Welfare Programs and Crime Spillovers

Author

Listed:
  • Jinkins, David Carson

    (Copenhagen Business School)

  • Kuka, Elira

    (George Washington University)

  • Labanca, Claudio

    (Monash University)

Abstract

Research on the social safety net examines its effects on recipients and their families. We show that these effects extend beyond recipients’ families. Using a regression discontinuity design and administrative data, we study a Danish policy that cut welfare benefits for refugees, increasing crime among affected individuals. Linking refugees to neighbors, we find increased crime among non-Danish neighbors, with spillovers persisting even after direct effects stabilize. Accounting for these spillovers raises the marginal value of public funds by 20%. We explore several mechanisms and find evidence consistent with peer effects among young individuals from the same country of origin.

Suggested Citation

  • Jinkins, David Carson & Kuka, Elira & Labanca, Claudio, 2025. "Welfare Programs and Crime Spillovers," IZA Discussion Papers 17958, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp17958
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp17958.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Brian Bell & Stephen Machin, 2013. "Immigrant Enclaves And Crime," Journal of Regional Science, Wiley Blackwell, vol. 53(1), pages 118-141, February.
    2. Rosholm, Michael & Vejlin, Rune, 2010. "Reducing income transfers to refugee immigrants: Does start-help help you start?," Labour Economics, Elsevier, vol. 17(1), pages 258-275, January.
    3. List, John A. & Momeni, Fatemeh & Zenou, Yves, 2020. "The Social Side of Early Human Capital Formation: Using a Field Experiment to Estimate the Causal Impact of Neighborhoods," IZA Discussion Papers 13966, Institute of Labor Economics (IZA).
    4. Gordon B. Dahl & Lance Lochner, 2012. "The Impact of Family Income on Child Achievement: Evidence from the Earned Income Tax Credit," American Economic Review, American Economic Association, vol. 102(5), pages 1927-1956, August.
    5. Stephen B. Billings & Jonah Rockoff, 2014. "School Segregation, Educational Attainment, and Crime: Evidence from the End of Busing in Charlotte-Mecklenburg," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(1), pages 435-476.
    6. Gordon B. Dahl & Andreas Ravndal Kostøl & Magne Mogstad, 2014. "Family Welfare Cultures," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(4), pages 1711-1752.
    7. Sebastian Calonico & Matias D. Cattaneo & Rocio Titiunik, 2014. "Robust data-driven inference in the regression-discontinuity design," Stata Journal, StataCorp LLC, vol. 14(4), pages 909-946, December.
    8. Christian Dustmann & Rasmus Landersø & Lars Højsgaard Andersen, 2024. "Unintended Consequences of Welfare Cuts on Children and Adolescents," American Economic Journal: Applied Economics, American Economic Association, vol. 16(4), pages 161-185, October.
    9. Marianne Bitler & Lisa A. Gennetian & Christina Gibson-Davis & Marcos A. Rangel, 2021. "Means-Tested Safety Net Programs and Hispanic Families: Evidence from Medicaid, SNAP, and WIC," The ANNALS of the American Academy of Political and Social Science, , vol. 696(1), pages 274-305, July.
    10. Sebastian Calonico & Matias D. Cattaneo & Rocio Titiunik, 2014. "Robust Nonparametric Confidence Intervals for Regression‐Discontinuity Designs," Econometrica, Econometric Society, vol. 82, pages 2295-2326, November.
    11. Claudio Labanca & Dario Pozzoli, 2022. "Constraints on Hours within the Firm," Journal of Labor Economics, University of Chicago Press, vol. 40(2), pages 473-503.
    12. Christian Dustmann & Rasmus Landersø & Lars Højsgaard Andersen, 2024. "Refugee Benefit Cuts," American Economic Journal: Economic Policy, American Economic Association, vol. 16(2), pages 406-441, May.
    13. Sah, Raaj K, 1991. "Social Osmosis and Patterns of Crime," Journal of Political Economy, University of Chicago Press, vol. 99(6), pages 1272-1295, December.
    14. Megan Stevenson, 2017. "Breaking Bad: Mechanisms of Social Influence and the Path to Criminality in Juvenile Jails," The Review of Economics and Statistics, MIT Press, vol. 99(5), pages 824-838, December.
    15. Matthew J Lindquist & Yves Zenou, 2019. "Crime and networks: ten policy lessons," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 35(4), pages 746-771.
    16. Ole Agersnap & Amalie Jensen & Henrik Kleven, 2020. "The Welfare Magnet Hypothesis: Evidence from an Immigrant Welfare Scheme in Denmark," American Economic Review: Insights, American Economic Association, vol. 2(4), pages 527-542, December.
    17. Hilary Hoynes, 2019. "The Earned Income Tax Credit," The ANNALS of the American Academy of Political and Social Science, , vol. 686(1), pages 180-203, November.
    18. Guido Imbens & Karthik Kalyanaraman, 2012. "Optimal Bandwidth Choice for the Regression Discontinuity Estimator," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 79(3), pages 933-959.
    19. Anna Piil Damm & Christian Dustmann, 2014. "Does Growing Up in a High Crime Neighborhood Affect Youth Criminal Behavior?," American Economic Review, American Economic Association, vol. 104(6), pages 1806-1832, June.
    20. Patrick Bayer & Randi Hjalmarsson & David Pozen, 2009. "Building Criminal Capital behind Bars: Peer Effects in Juvenile Corrections," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(1), pages 105-147.
    21. John A. List & Fatemeh Momeni & Yves Zenou, 2020. "The Social Side of Early Human Capital Formation: Using a Field Experiment to Estimate the Causal Impact of Neighborhoods," Working Papers 2020-187, Becker Friedman Institute for Research In Economics.
    22. 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 270-290, June.
    23. Michal Kolesár & Christoph Rothe, 2018. "Inference in Regression Discontinuity Designs with a Discrete Running Variable," American Economic Review, American Economic Association, vol. 108(8), pages 2277-2304, August.
    24. Raj Chetty & Nathaniel Hendren & Lawrence F. Katz, 2016. "The Effects of Exposure to Better Neighborhoods on Children: New Evidence from the Moving to Opportunity Experiment," American Economic Review, American Economic Association, vol. 106(4), pages 855-902, April.
    25. Manasi Deshpande & Michael Mueller-Smith, 2022. "Does Welfare Prevent Crime? the Criminal Justice Outcomes of Youth Removed from Ssi [“Misdemeanor Prosecution,”]," The Quarterly Journal of Economics, Oxford University Press, vol. 137(4), pages 2263-2307.
    26. Mette Foged & Janis Kreuder & Giovanni Peri, 2022. "Integrating Refugees by Addressing Labor Shortages? A Policy Evaluation," NBER Working Papers 29781, National Bureau of Economic Research, Inc.
    27. Manasi Deshpande & Michael G. Mueller-Smith, 2022. "Does Welfare Prevent Crime? The Criminal Justice Outcomes of Youth Removed From SSI," NBER Working Papers 29800, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gaurav Khanna & Carlos Medina & Anant Nyshadham & Jorge Tamayo & Nicolas Torres, 2023. "Formal Employment and Organised Crime: Regression Discontinuity Evidence from Colombia," The Economic Journal, Royal Economic Society, vol. 133(654), pages 2427-2448.
    2. Stefano Falcone, 2022. "Do Evictions Increase Crime? Evidence from Nuisance Ordinances in Ohio," Working Papers 1359, Barcelona School of Economics.
    3. Lindquist, Matthew & Patacchini, Eleonora & Vlassopoulos, Michael & Zenou, Yves, 2024. "Spillovers in Criminal Networks: Evidence from Co-Offender Deaths," CEPR Discussion Papers 19159, C.E.P.R. Discussion Papers.
    4. John A. List & Fatemeh Momeni & Yves Zenou, 2020. "The Social Side of Early Human Capital Formation: Using a Field Experiment to Estimate the Causal Impact of Neighborhoods," Working Papers 2020-187, Becker Friedman Institute for Research In Economics.
    5. Matilda Kilström & Birthe Larsen & Elisabet Olme, 2023. "Temporary refugee protection and labor-market outcomes," Empirical Economics, Springer, vol. 65(4), pages 1895-1929, October.
    6. D’Inverno, Giovanna & Smet, Mike & De Witte, Kristof, 2021. "Impact evaluation in a multi-input multi-output setting: Evidence on the effect of additional resources for schools," European Journal of Operational Research, Elsevier, vol. 290(3), pages 1111-1124.
    7. Stephen B. Billings & Mark Hoekstra, 2019. "Schools, Neighborhoods, and the Long-Run Effect of Crime-Prone Peers," NBER Working Papers 25730, National Bureau of Economic Research, Inc.
    8. Christian Dustmann & Mikkel Mertz & Anna Okatenko, 2023. "Neighbourhood Gangs, Crime Spillovers and Teenage Motherhood," The Economic Journal, Royal Economic Society, vol. 133(653), pages 1901-1936.
    9. Carmen Villa, 2024. "The effects of youth clubs on education and crime," IFS Working Papers W24/51, Institute for Fiscal Studies.
    10. Billings, Stephen B. & Hoekstra, Mark & Rotger, Gabriel Pons, 2024. "The scale and nature of neighborhood effects on children," Journal of Public Economics, Elsevier, vol. 240(C).
    11. Onda, Masayuki & Seyler, Edward, 2020. "English learners reclassification and academic achievement: Evidence from Minnesota," Economics of Education Review, Elsevier, vol. 79(C).
    12. Liu, Xiaodong & Patacchini, Eleonora & Zenou, Yves & Lee, Lung-Fei, 2011. "Criminal Networks: Who is the Key Player?," Research Papers in Economics 2011:7, Stockholm University, Department of Economics.
    13. Hızıroğlu Aygün, Aysun & Kırdar, Murat Güray & Koyuncu, Murat & Stoeffler, Quentin, 2024. "Keeping refugee children in school and out of work: Evidence from the world's largest humanitarian cash transfer program," Journal of Development Economics, Elsevier, vol. 168(C).
    14. Adam C. Sales & Ben B. Hansen, 2020. "Limitless Regression Discontinuity," Journal of Educational and Behavioral Statistics, , vol. 45(2), pages 143-174, April.
    15. Pastore, Chiara & Jones, Andrew M., 2023. "Human capital consequences of missing out on a grammar school education," Economic Modelling, Elsevier, vol. 126(C).
    16. Colombo, Luca & Labrecciosa, Paola & Rusinowska, Agnieszka, 2025. "A dynamic analysis of criminal networks," Journal of Economic Theory, Elsevier, vol. 223(C).
    17. Gurgand, Marc & Lorenceau, Adrien & Mélonio, Thomas, 2023. "Student loans: Credit constraints and higher education in South Africa," Journal of Development Economics, Elsevier, vol. 161(C).
    18. Alessio Gaggero & Getinet Haile, 2020. "Does class size matter in postgraduate education?," Manchester School, University of Manchester, vol. 88(3), pages 489-505, June.
    19. Vincent Boucher & Carlo L. Del Bello & Fabrizio Panebianco & Thierry Verdier & Yves Zenou, 2023. "Education Transmission and Network Formation," Journal of Labor Economics, University of Chicago Press, vol. 41(1), pages 129-173.
    20. Emeline Bezin & Thierry Verdier & Yves Zenou, 2022. "Crime, Broken Families, and Punishment," American Economic Journal: Microeconomics, American Economic Association, vol. 14(4), pages 723-760, November.

    More about this item

    Keywords

    ;
    ;
    ;

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp17958. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.