The Effects of Wage and Unemployment on Crime Incentives – An Empirical Analysis of Total, Property and Violent Crimes

Paulo Augusto Pettenuzzo de Britto and Tatiana Alessio de Britto

No 46/2014, Economics and Politics Working Paper Series from Economics and Politics Research Group (EPRG), University of Brasília

Abstract: Using quarterly data of the U.S economy and based on cointegration analysis, we built a relatively simple error correction model focusing on a few key variables that can help prove that crime is an induced response to economic incentives. In particular, we found causality summing from unemployment and wage levels to total crime in the long-run, and causality from wage to total crime in the short-run. For property crime, we found the above relationships plus a short-run causality from unemployment. Finally, violent crime seems not to be explained by economic variables.

Keywords: crime; property crime; violent crime; error correction model; K0; K4 (search for similar items in EconPapers)
JEL-codes: C32 (search for similar items in EconPapers)
Date: 2014-12-17
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Persistent link: https://EconPapers.repec.org/RePEc:gvn:eprgwp:462014

DOI: 10.5281/zenodo.23601935

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