Wage Inequalities, Unemployment and Crime in the Transition and the Post-Transition Period : Case of Romania

This article analyses the impact of the unemployment level and the wage inequalities among economic sectors on the criminality degree in the case of a country that experienced a long period of economic transition. Starting from the traditional perspective established by Becker (1968), we put forward a theoretical model that evaluates the crime behavior. In order to test the conclusions model, we constructed an original panel for all Romania's counties including full data from 1991 to 2008. Our estimates show that increasing the number of unemployed has a positive impact on the number of crimes recorded by police. These results are consistent with those already obtained in the economic literature. Furthermore, a reduced gap between the minimum legal wage and the average wage can favor the decrease of crime behaviors especially in the case of the industrial sector. Thus, if the Romanian state decides to reduce the number of crimes, it would be useful to improve the public policy of unemployment and investment