A Vicious Cycle of Regional Unemployment and Crime? - Evidence from German Counties

Tim Umbach

VfS Annual Conference 2020 (Virtual Conference): Gender Economics from Verein für Socialpolitik / German Economic Association

Abstract: Much research has been done showing that unemployment can cause crime, and that crime adversely impacts economic activity. However, very few authors have considered a simultaneous relationship. Using an IV-setup and regional panel-data, I find evidence for the possibility of a vicious cycle, with unemployment leading to higher crime rates and crime rates raising unemployment. I further find that especially employment in low-skill service jobs is adversely affected by crime, that many types of crime are impacted by unemployment differently and that both apartment rents and GDP-growth decrease if crime increases. The spatial dependencies found further raise the possibility that these vicious cycles could spill over into neighboring regions.

Keywords: Crime; Unemployment; Amenities; spatial autregresssive model; SARAR; endogenous regessors. (search for similar items in EconPapers)
JEL-codes: J21 J32 K42 R11 R23 R30 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-eur, nep-geo, nep-law, nep-lma and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc20:224611

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