3. Are the Criminogenic Consequences of Economic Downturns Conditional?

Abstract

This chapter shows how levels of inflation moderate the impact of unemployment on property crime and age-specific homicide rates for a sample of 82 American cities over the period between 1980 and 2009. The effect of unemployment on property crime rates and homicide is stronger during periods of high inflation; in fact, no relationship exists between unemployment and these crimes during periods of below-average inflation rates. And contrary to expectations, this study finds no evidence that the level of unemployment insurance benefits or a measure of drug market activity moderates the effect of economic adversity on crime rates. Thus it is recommended that future research on the relationship between macroeconomic conditions and crime rates move beyond simplistic assessments of “main effects” and consider the role of inflation and other conditions in moderating the relationship between crime rates and economic conditions such as unemployment and wages.