The Effect of Economic Conditions on Crimes

Abstract

Using quarterly data for the period January 1982 to April 2004, this paperexamines the causal effects of economic conditions on crimes in Korea,Empirical evidence suggests that income inequality and unemployment positivelyGranger-cause theft, while income level does not. Income level has a negativeeffect and unemployment has a positive effect on assault, while incomeinequality does not have a significant effect. This evidence may imply differenteffects of relative and absolute deprivation on different types of crimes, andsupport the institutional role of steady employment in controlling criminalbehavior often emphasized in sociology and criminology.