This article provides a unified explanation for why blacks commit more crime, are located in poorer neighborhoods, and receive lower wages than whites. If everybody believes that blacks are more criminal than whites - even if there is no basis for this - then blacks are offered lower wages and,...

We propose a model of intergenerational transmission of education wherein children belong to either highly educated or low-educated families. Children choose the intensity of their social activities while parents decide how much educational effort to exert. Using data on adolescents in the...

This paper presents a new theory of crime where leaders transmit a crime technology and act as a role model for other criminals. We show that, in equilibrium, an individual's crime effort and criminal decisions depend on the geodesic distance to the leader in his or her network of social...

We propose a model of intergenerational transmission of education wherein children belong to either highly educated or low-educated families. Children choose the intensity of their social activities while parents decide how much educational effort to exert. Using data on adolescents in the...

We analyse an oligopoly model in which differentiated criminal organisations globally compete on criminal activities and engage in local corruption to avoid punishment. When law enforcers are sufficiently well-paid, difficult to bribe and corruption detection highly probable, we show that...

We first develop a model of identity formation resulting from the interaction of cultural transmission and socialization inside the family, peer effects and social interactions, and identity choice. We then put the model to data using the UK Fourth National Survey of Ethnic Minorities. We show...