Job Loss, Credit and Crime in Colombia

29 Pages Posted: 14 Oct 2019 Last revised: 26 May 2021

See all articles by Gaurav Khanna

Gaurav Khanna

University of California, San Diego (UCSD)

Carlos Medina

Central Bank of Colombia

Anant Nyshadham

University of Michigan, Stephen M. Ross School of Business

Christian Manuel Posso-Suárez

Central Bank of Colombia

Jorge Tamayo

Harvard University - Business School (HBS)

Date Written: September 2019

Abstract

We investigate the effects of job displacement, as a result of mass-layoffs, on criminal arrests using a novel matched employer-employee-crime dataset in Medellín, Colombia. Job displacement leads to immediate earnings losses, and an increased likelihood of being arrested for both the displaced worker and for other youth in the family. We leverage variation in opportunities for legitimate reemployment and access to consumption credit to investigate the mechanisms underlying this job loss-crime relationship. Workers in booming sectors with more opportunities for legitimate reemployment exhibit smaller increases in arrests after job losses. Greater exposure to expansions in consumption credit also lowers the job loss-crime elasticity.

Suggested Citation

Khanna, Gaurav and Medina, Carlos and Nyshadham, Anant and Posso-Suárez, Christian Manuel and Tamayo, Jorge A., Job Loss, Credit and Crime in Colombia (September 2019). NBER Working Paper No. w26313, Available at SSRN: https://ssrn.com/abstract=3469382

Gaurav Khanna (Contact Author)

University of California, San Diego (UCSD) ( email )

9500 Gilman Drive
Mail Code 0502
La Jolla, CA 92093-0112
United States

HOME PAGE: http://www.econgaurav.com

Carlos Medina

Central Bank of Colombia ( email )

Carrera 7 #14-78
3551 de Bogotá
Colombia

Anant Nyshadham

University of Michigan, Stephen M. Ross School of Business ( email )

701 Tappan Street
Ann Arbor, MI MI 48109
United States

Christian Manuel Posso-Suárez

Central Bank of Colombia ( email )

Carrera 7 #14-78
3551 de Bogotá
Colombia

Jorge A. Tamayo

Harvard University - Business School (HBS) ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
8
Abstract Views
380
PlumX Metrics