Llad Phillips1 Jobs and Crime

Llad Phillips2 Class Survey 2005 Scoring Ten Behaviors Scoring Ten Behaviors 98 responses 98 responses

Llad Phillips3 Mode = 10, largest number of responses Median = 10, score of 49 th person

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Llad Phillips5 Mode = 9 Median = 9

Llad Phillips6 Mode = 1 Median = 2

Llad Phillips Frequency Score Number of Responses Vs. Possession of Pot Score ‘02

Llad Phillips8 SERIOUSNESS SURVEY RATE THE SERIOUSNESS OF EACH OF THE FOLLOWING BEHAVIORS ON A SCALE FROM ZERO( LEAST SERIOUS) TO TEN( MOST SERIOUS): Minimum, Maximum 1. HOMICIDE _1, MASS POISONING ( e.g. TYLENOL) _1, FORCIBLE RAPE _3,10 4. ARSON: SET FIRE TO A GARAGE _1, SELLING HEROIN _0, AUTO THEFT _0, EMBEZZLEMENT OF $1,000 _1, PROSTITUTE IN A HOUSE OF PROSTITUTION _0, POSSESSION OF MARIJUANA _0, SNIFFING GLUE _0, 10

Llad Phillips9 Center of the Scores Distribution Mode: most likely Mode: most likely Median: middle person Median: middle person Average: sum of scores divided by total number of people Average: sum of scores divided by total number of people

Llad Phillips10 SERIOUSNESS SURVEY RATE THE SERIOUSNESS OF EACH OF THE FOLLOWING BEHAVIORS ON A SCALE FROM ZERO( LEAST SERIOUS) TO TEN( MOST SERIOUS): MEDIAN ‘03 ‘05 1. HOMICIDE _10 10__ 2. MASS POISONING ( e.g. TYLENOL) _ 9 8__ 3. FORCIBLE RAPE _ 9 9__ 4. ARSON: SET FIRE TO A GARAGE _ 7 7__ 5. SELLING HEROIN _ 6 6__ 6. AUTO THEFT _ 5.5 6__ 7. EMBEZZLEMENT OF $1,000 _ 4 4__ 8. PROSTITUTE IN A HOUSE OF PROSTITUTION _ 3 3__ 9. POSSESSION OF MARIJUANA _ 2 2__ 10. SNIFFING GLUE _ 1 1__

Llad Phillips11 Dispersion of Scores Distribution

Llad Phillips12 Black Market or Status Offensus Property Crimes Violent Crimes

Llad Phillips13 Disagreement Versus Seriousness, 02 Arson Selling Heroin Auto Theft Embezzle Mass Poisoning Rape Homicide Prostitute Possess Pot Sniff Glue Score Dispersion (Standard Deviation) Homicide 2004

Embezzlement Standard Deviation or Dispersion

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Llad Phillips16 Types of Crime Motivation: self-interest, greed Motivation: self-interest, greed  Street Crimes: robbery, burglary, auto theft, larceny  White Collar: embezzlement, tax evasion, check fraud, telephone fraud  Status Offenses: runaway, truant, vagrant, beyond control of parents  Black Market: gambling, prostitution,drugs

Llad Phillips17 Types of Crime Motivation: Hate, Rage Motivation: Hate, Rage  Street Crimes: homicide, aggravated assault, rape  Crimes Against Public Order: vandalism, terrorism  Hate Crimes  Columbine High  James Byrd: dragging death in Texas  Jewish Community Center in Granada Hills

Llad Phillips18 Jobs and Crime

Llad Phillips19 Questions About Crime Does the Business Cycle Affect Crime Rates? Does the Business Cycle Affect Crime Rates? Does an Individual’s Life Cycle Affect Crime Rates? Does an Individual’s Life Cycle Affect Crime Rates? Why do some people live socially unproductive lives? Why do some people live socially unproductive lives?

Llad Phillips20 Two Points About Economic Conditions and Crime Relationship of Crime to the Business Cycle Relationship of Crime to the Business Cycle  Short Run: Business Cycle  Is Phil Cook wrong?  California: the misery index and crime  misery index = unemployment rate + inflation rate Relationship of Crime to the Life Cycle Relationship of Crime to the Life Cycle  Long Run  Investment in Education  Role of the Family

Llad Phillips21 Misery Index, California year Rate unemployment rate inflation rate misery index

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Llad Phillips28 An Individual’s Life Cycle for a Socially Productive Life Learning over the life cycle Learning over the life cycle Accumulating earning power or human capital Accumulating earning power or human capital Earnings depend upon Earnings depend upon  ability  knowledge  work experience

Llad Phillips29 Productive Life Cycle Social Institution Family - PreSchool - School - College - Job - Retirement Function Learning: Accumulating Human Capital - Earning - Spending Age Line

Llad Phillips30 Accumulating Human Capital InflowOutflow Stock

Llad Phillips31 Accumulating Human Capital Stock Inflow + - Outflow Net Inflow

Llad Phillips32 Accumulating Human Capital Human Capital Learning + - Depreciation Investment

Llad Phillips33 Allocation of Your Time Human Capital Build Capital by Learning Use Capital for Earning

Llad Phillips34 Time Endowment 24 hours

Llad Phillips35 24 hours0 hours Leisure (learning)

Llad Phillips36 Allocation of Your Time Human Capital Build Capital by Learning Use Capital for Earning

Llad Phillips37 24 hours0 hours Leisure (learning) Earnings $480 Opportunities for trading leisure for earnings (income) at a rate, $20 per hour, determined by your stock of human capital $ 0

Llad Phillips38 Salaries by Education Level, CA Full Time* Workers *Full Time: >35 hrs/wk, >48 wks/yr.; Source: LA Times,

24 hours0 hours Leisure (learning) Earnings $480 $ 0 $240 dropout college grad

Llad Phillips40 Economists Assume You Can make Comparisons For example: you can compare a high level of your income and a low level of your leisure with a low level of your income and a high level of your leisure For example: you can compare a high level of your income and a low level of your leisure with a low level of your income and a high level of your leisure

24 hours0 hours Leisure (learning) Earnings $480 $ 0 Iso-Preference Curves: You value all points on a curve equally high low value high value

24 hours0 hours Leisure (learning) Earnings $480 $ 0 high low value high value Optimum 15 hours of leisure $180 for 9 hrs of work

24 hours0 hours Leisure (learning) Earnings $480 $ 0 high low value slope of the iso-preference curve through the 24 hour endowment is the lowest wage at which you are willing to work

24 hours0 hours Leisure (learning) Earnings $480 $ 0 high low value slope of the iso-preference curve through the 24 hour endowment is the lowest wage at which you are willing to work $98 dropout is unwilling to work for $4/hr

Llad Phillips45 Participation in the Labor Force: Willing to look for work If your market wage exceeds your reservation wage If your market wage exceeds your reservation wage  college participates  the junior high $4/hr, does not We assumed the college grad and the dropout both have the same values for income and leisure We assumed the college grad and the dropout both have the same values for income and leisure Only their learning histories differ Only their learning histories differ

24 hours0 hours Leisure (learning) Earnings $480 $ 0 high low value slope of the iso-preference curve through the 24 hour endowment is the lowest wage at which you are willing to work $98 dropout is unwilling to work for $4/hr

Llad Phillips47 Hazards to Personal Success Dropping out Dropping out Joining gangs Joining gangs Anti-social behavior Anti-social behavior

Llad Phillips49 Productive Life Cycle Social Institution Family - PreSchool - School - College - Job - Retirement Function Learning: Accumulating Human Capital - Earning - Spending Age Line

Legal Work or Illegal Work? Choice with Uncertain Outcomes Choice Legal work Illegal work

Legal Work or Illegal Work? Choice with Uncertain Outcomes Choice Legal work Illegal work Unemployed (fail) Employed (succeed) Apprehended (fail) Not Apprehended (succeed)

Legal Work or Illegal Work? Choice with Uncertain Outcomes Choice Legal work Illegal work Unemployed (fail) Employed (succeed) Apprehended (fail) Not Apprehended (succeed) $0 $12,000/yr $0 $14,000

Expected legal Income = 0.9*$12,000 = $10,800 Legal Work or Illegal Work? Choice with Uncertain Outcomes Choice Legal work Illegal work Unemployed (fail) Employed (succeed) Apprehended (fail) Not Apprehended (succeed) $0 $12,000/yr $0 $14,000/yr Expected illegal income = 0.8*$14,000 = $11,200

Expected legal Income = 0.95*$12,000 = $11,400 Legal Work or Illegal Work? Choice with Uncertain Outcomes Choice Legal work Illegal work Unemployed (fail) Employed (succeed) Apprehended (fail) Not Apprehended (succeed) $0 $12,000/yr $0 $14,000/yr Expected illegal income = 0.8*$14,000 = $11,

Llad Phillips55 Social Measures to Reduce Crime Maintain a full-employment economy Maintain a full-employment economy

Expected legal Income = 0.9*$12,000 = $10,800 Legal Work or Illegal Work? Choice with Uncertain Outcomes Choice Legal work Illegal work Unemployed (fail) Employed (succeed) Apprehended (fail) Not Apprehended (succeed) $0 $12,000/yr $0 $14,000/yr Expected illegal income = 0.7*$14,000 = $9,

Llad Phillips57 Social Measures to Reduce Crime Maintain an Effective Criminal Justice System Maintain an Effective Criminal Justice System  keep the probability of apprehension high

Expected legal Income = 0.9*$12,000 = $10,800 Legal Work or Illegal Work? Choice with Uncertain Outcomes Choice Legal work Illegal work Unemployed (fail) Employed (succeed) Apprehended (fail) Not Apprehended (succeed) $0 $12,000/yr $3,000 (fine) $14,000/yr Expected illegal income = 0.8*$14, *$3,000 = $10,600 $0

Llad Phillips59 Social Measures to Reduce Crime Punish the criminal Punish the criminal  make crime less attractive

Llad Phillips60 Social Measures to Reduce Crime Maintain a full-employment economy Maintain a full-employment economy Maintain an Effective Criminal Justice System Maintain an Effective Criminal Justice System  keep the probability of apprehension high Punish the criminal Punish the criminal  make crime less attractive

Llad Phillips61 Summary Your economic status affects your probable behavior: work or crime Your economic status affects your probable behavior: work or crime Earning power affects your probable behavior Earning power affects your probable behavior When you are are a young teen you need a parent or role model to motivate you to stay in school and keep learning When you are are a young teen you need a parent or role model to motivate you to stay in school and keep learning

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Llad Phillips63 Class Survey 2003 Scoring Ten Behaviors Scoring Ten Behaviors 113 Responses 113 Responses No two are the same No two are the same Two most similar responses Two most similar responses Two most different responses Two most different responses

Llad Phillips64 Similar Scorings

Llad Phillips65 Different Scorings

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Llad Phillips68 Mean Rating