WAGE INEQUALITY AND CRIMINAL ACTIVITY: AN EXTREME BOUNDS ANALYSIS FOR THE UNITED STATES, 1975–1990*

The past decades in the United States have been characterized by a widening in the distribution of wage income. While much research has attempted to uncover the causes of these earnings trends, much less is known about their impact upon social and economic factors. This study examines evidence for links between changes in distribution of wage income and criminal activity. Using extreme bounds analysis in conjunction with ordinary least squares regression, the study shows that robust results linking wage inequality and crime are obtainable across a rich set of model specifications for the violent crimes of murder and assault. No evidence is found linking wage inequality with the crimes of robbery and burglary. Results are inconclusive for larceny/theft, motor vehicle theft, and forcible rape. These results should be viewed as a first stage in examining the link between wage inequality and criminal activity. Research into the specific behavioral complexities underlying these relationships should be considered to affirm these results.