TY  - JOUR
AB  - Purpose Since the literature on the effect of the unemployment rate as reflection of economic fluctuations on crime shows an empirically ambiguous effect, the purpose of this paper is to argue that a new way of modeling the dynamics of unemployment and crime by focussing on the transitory and persistent effect of unemployment on crime helps resolve this ambiguity.Design/methodology/approach Panel data for US states from 1965 to 2006 are examined using the Mundlak (1978) methodology to incorporate the dynamic interactions between crime and unemployment into the estimation.Findings After decomposing the unemployment effect on crime into a transitory and persistent effect, evidence of a strong positive correlation between unemployment and almost all types of crime rates is unearthed. This evidence is robust to endogeneity and the controlling for cross-panel correlation and indicators for state imprisonment.Originality/value The paper is the first to examine the dynamics of the interaction of crime and economic fluctuations using the temporary and persistent effects framework of Mundlak (1978). In one set of estimates, one can evaluation both the short- and long-run effects of changes of unemployment on crime.
VL  - 43
IS  - 4
SN  - 0144-3585
DO  - 10.1108/JES-05-2015-0085
UR  - https://doi.org/10.1108/JES-05-2015-0085
AU  - Bender Keith
AU  - Theodossiou Ioannis
PY  - 2016
Y1  - 2016/01/01
TI  - Economic fluctuations and crime: temporary and persistent effects
T2  - Journal of Economic Studies
PB  - Emerald Group Publishing Limited
SP  - 609
EP  - 623
Y2  - 2024/04/24
ER  -