School or Crime: A Teenager's Choice

• In Event: Youth Interventions and Crime

Abstract

This paper studies how criminal shocks influence teenagers' education choices and the role of public policy in preventing criminal involvement. We focus on the 2008 extradition of Medellín's top gang leader, Don Berna, which triggered increased gang conflict and neighborhood-level variation in criminal activity. Using rich administrative data from Medellín, we show that dropout rates among boys rose significantly in areas affected by the shock, while girls were largely unaffected—suggesting increased gang recruitment targeting boys. We find that policy could have relevant role in preventing kids to choose a criminal path. In particular, CCTs reduce overall dropout rates, their impact in the context of heightened gang activity may be limited. We develop and estimate a dynamic structural model of schooling, crime, and labor market choices from middle school to early adulthood. We use reduced-form evidence to identify changes in the criminal payoff and evaluate the effectiveness of Conditional Cash Transfer (CCT) programs in mitigating dropout. Preliminary simulation suggest that, in the absence of subsidies, more youth would have dropped out and entered crime. The model is used to assess alternative policies aimed at reducing dropout and criminal participation.

Author

• Andrea Franco, University of Wisconsin-Madison
  Presenting Author