Effects of Incarceration on Employment and Earnings: The Mediating Role of Education

• In Event: Work, Crime, and the Consequences of Criminal Records: Causal Evidence on Labor Market Impacts

Abstract

This research studies the relationship between education, incarceration, and post-release labor market outcomes. Leveraging discontinuities in Minnesota’s criminal sentencing guidelines, I estimate the treatment effects of incarceration on reoffense, employment, wages, and post-sentencing educational attainment. I use a rich set of case-specific linked administrative data including sentencing information, case characteristics, defendant demographic information, education history, and wage and employment records.

These data allow me to build upon existing causal evidence regarding incarceration’s effects on employment and wages, by understanding the role of education prior to interactions with the criminal justice system and carceral education. Using pre-offense education, I can glean its role in judicial decision-making as well estimate heterogeneous treatment effects of incarceration by education. Using a regression discontinuity approach, I can estimate the effect of both incarceration and incarceration length on GED attainment. Furthermore, I can study carceral GED attainment as a mediator in the effects of incarceration on employment and earnings. This research therefore holistically contributes to our understanding of the role of education in breaking the incarceration cycle.

Beyond the effects of education, I conduct several analyses to understand the heterogeneous effects of incarcerations and how they may relate to judges’ incentives when making sentencing decisions. Firstly, utilizing discontinuities in Minnesota’s criminal sentencing guidelines as a plausibly exogenous source of variation, I am able to use a control function approach to estimate judges’ willingness to pay (in term of costly incarceration) for reduction in probability of recidivism. I am also able to estimate heterogeneity in judges’ taste for recidivism. Similarly, I am able to use marginal treatment effects to understand the relationship between judicial departures from recommendations and heterogeneous treatment effects of incarceration.

Finally, I contextualize these estimates in a cost-benefit analysis, to understand the fiscal impacts of marginal changes to criminal sentencing, carceral education programs, and high school completion initiatives.

Author

• Ethan James Ellis, University of Minnesota
  Presenting Author