Jobs or jails? The crime drop in Texas

Crime went down throughout the U.S. in the 1990s. Potential explanations include demographic shifts, improved economic opportunities, changes in drug markets, evolving police strategies, and an increasing prison population. Previous attempts to parcel out responsibility among these explanations are unpersuasive. Some do not consider all of the explanations, others rely on highly aggregated data, still others confuse cause and effect. An analysis of Texas counties that deals with these problems shows that the Texas crime drop was largely due to increases in the jail and prison population; property crime also dropped due to increases in real wages and wealth and in public order arrests. Further prison construction would not be cost-effective in Texas due to declining marginal returns, but direct interventions to improve economic opportunities or make police work more proactive may be. © 2005 by the Association for Public Policy Analysis and Management.