The Impact of Economic Opportunity on Criminal Behavior : Evidence from the Fracking Boom
Theory suggests crime should decrease as economic opportunities increase the returns to legal activities. However, there are well-documented cases where crime increases when areas become more prosperous. This paper addresses this puzzle by focusing on existing residents, isolating local economic effects from changing composition. Specifically, I exploit within- and across-county variation in fracking activities in North Dakota using individual-level data on residents, mineral lease records, and criminal charges. Results document a 14-18% reduction in crime for existing residents. These results are consistent with theory and in contrast to aggregate increases in crime from fracking, highlighting the importance of compositional changes