The “New Fiscal Criminology”: State-Level Changes in Crime Rates and the Structure of Tax Systems

Abstract

Prior research has examined the effects of social welfare on levels of crime in the U.S. The emphasis has been on how governmental support in the form of social spending may influence crime levels because it serves as a mechanism to lessen the impact of adverse financial circumstances that may stimulate criminal behavior. This study builds on prior research by assessing the impact of another mechanism that affects the distribution of economic resources: the structure of the tax system. Specifically, we incorporate the “Suits Index,” a novel measure of the progressivity of the tax system. Our analysis examines the effects of changes in the Suits Index on changes in robbery and burglary rates using data for the 50 U.S. states between 1995 and 2017. Results indicate that movement towards greater progressivity in the tax structure was associated with decreases in robbery and burglary rates, net of changes in social spending.