Long term unemployment and violent crimes - using post-2000 data to reinvestigate the relationship between unemployment and crime

Abstract This study reinvestigates the relationship between unemployment and crime. By being the first study to use long-term unemployment, it contributes unique findings. Moreover, with a Swedish panel consisting of 288 municipalities and annual data from 1997 to 2009, the relationship is investigated for the first time with aggregate post-2000 data. The results show that long-term unemployment exhibits a strong association with violent crimes in addition to property crimes, highlighting a potential gap in the conventional theories of economics of crime. The point-estimate of long-term unemployment for violent crimes is between 1.5 and 4, and for property crimes it is between 1.3 and 2.3. Thus, long-term unemployment identifies a marginal group for committing crimes, particularly violent crimes, better than total unemployment does. Long-term unemployment plausibly creates a feeling of alienation that fosters violent and other non-rational behaviors.