Crime, Employment and Social Welfare: An Individual-Level Study on Disadvantaged Males

Tinbergen Institute Discussion Paper 14-091/III

35 Pages Posted: 23 Jul 2014

See all articles by Geert Mesters

Geert Mesters

Vrije Universiteit Amsterdam, School of Business and Economics

Victor van der Geest

VU University Amsterdam

Catrien Bijleveld

University of Amsterdam - Faculty of Law

Date Written: July 14, 2014

Abstract

We test economic and sociological theories for the relationship between employment and crime, where social welfare is used as an identifying mechanism. We consider a sample of disadvantaged males from The Netherlands who are observed between ages 18 and 32 on a monthly time scale. We simultaneously model the offending, employment and social welfare variables using a dynamic discrete choice model, where we allow for state dependence, reciprocal effects and time-varying unobserved heterogeneity. We find significant negative bi-directional structural effects between employment and property crime. Robustness checks show that only regular employment is able to significantly reduce the offending probability. Further, a significant uni-directional effect is found for the public assistance category of social welfare on property offending. The results highlight the importance of economic incentives for explaining the relationship between employment and crime for disadvantaged individuals. For these individuals the crime reducing effects from the public assistance category of social welfare equivalent to those from employment, which suggests the importance of financial gains. Further, the results suggest that stigmatizing effects from offending reduce the future employment probability.

Keywords: dynamic discrete choice, strain, social control, state dependence, reciprocal, unobserved heterogeneity

JEL Classification: K42, C32, C33

Suggested Citation

Mesters, Geert and van der Geest, Victor and Bijleveld, Catrien, Crime, Employment and Social Welfare: An Individual-Level Study on Disadvantaged Males (July 14, 2014). Tinbergen Institute Discussion Paper 14-091/III, Available at SSRN: https://ssrn.com/abstract=2469716 or http://dx.doi.org/10.2139/ssrn.2469716

Geert Mesters (Contact Author)

Vrije Universiteit Amsterdam, School of Business and Economics ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands

Victor Van der Geest

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, ND North Holland 1081 HV
Netherlands

Catrien Bijleveld

University of Amsterdam - Faculty of Law ( email )

Amsterdam, 1018 WB
Netherlands

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