Income drop predictor of crime

Nieuws | de redactie
5 december 2012 | A dataset of over a million individuals over ten years’ time. Dutch crime statistics are a rare delight for Maastricht researcher Olivier Marie, who pinpoints a drop in income two or three years before crimes are committed.

How does crime participation relate to income and job opportunities? Whatever assumptions you might have, the topic had not yet been researched in a thorough, scientific way. That is, until Olivier Marie, PhD, received a Veni grant allowing him to apply advanced micro-econometric techniques to vast datasets from Statistics Netherlands (CBS).

“Pinning down causality empirically, measuring the relative importance of various factors that affect the complex relationship between labour market opportunities and criminal activity, and assessing whether effect sizes vary across different personality types and circumstances is a challenging task”, Marie says in a recent publication of the Maastricht University.

Amazing data

It all started with the unique data gathered by the CBS. “One of the reasons I moved to the Netherlands after doing my PhD in the UK was that the data is amazing here.” In large surveys, starting at the age of 12, Dutch citizens are questioned about their education, character traits, income, friends and more. If you combine this with the police information on everyone arrested between 1997 and 2012, the result is a dataset with over a million individuals followed over ten years.

“We can link the two datasets using the personal identification numbers. And then we can see what happens with things like a person’s legal income a few years before he or she commits a crime. Not everyone will turn to crime after an income drop, so we also try to identify certain groups of people who are more likely to commit a crime. Is it young people, ethnic minorities?”

“Immigrants in the Netherlands are disproportionately represented in crime statistics, but if you control for education level and parents’ social background, the effect disappears. And then we can even try to pinpoint certain personality traits that enhance the likelihood of committing a crime.” Individual anonymity and data security is, of course, always guaranteed.

Optimal way to reduce crime

Using sophisticated econometric methods, Marie also tries to find out what causes the income shocks that seem to play a major role in turning to crime. “It may be that certain Dutch policies have had a big effect on the income of some parts of the population. For example, research in the United States has shown that it’s better to pay welfare benefits to poorer people weekly rather than monthly. In the latter case, three days before the end of the month you’d see a big increase in crime. People with a low income are more likely to commit a crime, so you need to keep this in mind if you really want to influence crime participation.”

The final stage of the research project thus looks at policy implications. The optimal way to reduce crime is through prevention, as this is much cheaper than repression. “Locking someone up in jail costs a good salary a year. Estimates show that ten per cent of people who commit a crime are responsible for fifty per cent of all crimes. So if we can target those individuals with policies that prevent an income drop, we might be able to prevent a lot of crimes.”

Crime and Maastricht coffeeshops

But, as Marie stresses, the most important thing is that the research is carried out in a solid, scientific way. “Up to the 1990s, lots of crime research was done semi-badly. The distinction between correlation and causation was not always made.”

Take the question whether having more police reduces crime. “You would assume that it does. But a lot of research in the 80s and 90s concluded that in areas with more crime, there are more police, therefore police increase crime. That’s reverse causality. One of my PhD papers showed that having more police has a strong effect on reducing crime; it’s one of the only European paper on this topic. I did my PhD ‘Essays on the economics of crime’ between 2005 and 2009, and I’m from one of the first generations of economics PhDs that was taught to do crime research very seriously.”

Apart from his Veni research, Marie is attempting to obtain the data necessary to investigate the impact on crime of the different coffee shop bans in Maastricht in recent years. “You might not find a better example of drug tourism than Maastricht”, he concludes with enthusiasm. “Crime research goes in many directions.”

Olivier Marie is Post-Doctoral research fellow at the Research Centre for Education and the Labour Market (ROA) since February 2009.

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