DP13431 Scaring or scarring? Labour market effects of criminal victimisation

Author(s): Anna Bindler, Nadine Ketel
Publication Date: January 2019
Date Revised: January 2019
Keyword(s): crime, event-study design, labour market outcomes, victimisation
JEL(s): I1, J01, J12, K4
Programme Areas: Labour Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=13431

Little is known about the costs of crime to victims and their families. In this paper, we use unique and detailed register data on victimisations and labour market outcomes from the Netherlands to overcome data restrictions previously met in the literature and estimate event-study designs to assess the short- and long-term effects of criminal victimisation. Our results show significant decreases in earnings (6.6-9.3%) and increases in the days of benefit receipt (10.4-14.7%) which are lasting up to eight years after victimisation. We find shorter-lived responses in health expenditure. Additional analyses suggest that the victimisation can be interpreted as an escalation point, potentially triggering subsequent adverse life-events which contribute to its persistent impact. Heterogeneity analyses show that the effects are slightly larger for males regarding earnings and significantly larger for females regarding benefits. These differences appear to be largely (but not completely) driven by different offence characteristics. Lastly, we investigate spill-over effects on non-victimised partners and find evidence for a spill-over effect of violent threat on the partner's earnings.