Crime, correction, education and welfare in the U.S. – What role does the government play?

Devika Hazra and Jose Aranzazu

Journal of Policy Modeling, 2022, vol. 44, issue 2, 474-491

Abstract: As federal, state and local governments continue to allocate a significant share of their resources to law enforcement and correctional spending, concerns have risen that spending in education and welfare is declining. With fiscal pressure in the United States mounting, it is important to determine the effectiveness of public spending in deterring crime. This paper compares the effectiveness of the impact of government spending on welfare and education with that of law enforcement and correction on crime. Using panel data from 50 U.S. states over a time period of 1994–2014, results of linear regression with panel corrected standard errors as well as GMM estimation reveals that public welfare and education spending can potentially lower violent and property crime rates but law enforcement spending can only deter property crime. However, correctional spending can exacerbate both types of crimes. There is little to no evidence of the presence of crowding out of one category of spending by another. This results in the policy implication that more resources be allocated towards welfare and education programs.

Keywords: Crime rate; Macroeconomic conditions; Welfare spending; Education spending; Crime-related spending (search for similar items in EconPapers)
JEL-codes: H50 I20 I30 J11 K40 K42 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:44:y:2022:i:2:p:474-491

DOI: 10.1016/j.jpolmod.2022.03.007

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