To study the problem of widespread youth crime, the author analyzes a time-allocation model in which consumers face parametric wages and diminishing marginal returns to crime. The theory motivates an econometric model that he estimates using data from the National Longitudinal Survey of Youth. The author's estimates suggest that youth behavior is responsive to price incentives and that falling real wages may have been an important determinant of rising youth crime during the 1970s and 1980s. Moreover, wage differentials explain a substantial component of both the racial differential in criminal participation and the age distribution of crime. Copyright 1998 by University of Chicago Press.

Around 1980, the trend toward racial wage convergence essentially stopped. I ask whether this break in the convergence trend can be explained by school quality. Department of Education surveys provide earnings data for the high school Class of 1972 in 1979 and the Class of 1980 in 1986, both linked to data from the respondents' high schools. By several measures, differences between schools attended by blacks and whites were already rather small in the 1970s. Furthermore, I find that measurable school inputs generally have little effect on wages. Thus school quality explains little of the recent black/white wage trend.

Studies based on inputs measured at the state level generally report that school expenditures have substantial effects on students' adult wages, whereas studies based on less aggregated measures report small effects. The author uses wage data from High School and Beyond to analyze this discrepancy, and to estimate the effect of school expenditures on students' post-schooling earnings. The author finds that the discrepancy in the literature stems mostly from two factors: measurement error in district-level expenditures and omitted state effects in the earnings regression. The author also finds that the effect of school expenditures on earnings is significant but small. A 10% increase in school spending would increase students' adult wages by only 0.68%. Copyright 1996 by MIT Press.

Economists have long been concerned with the labor market problems of young men. Recently, research has indicated that one-fourth to one-half of all men are active in crime at some point during their youth. Furthermore, joblessness and criminal activity vary similarly by age and race. The author analyzes two data sets containing arrest and employment information to assess whether criminal activities may underlie persistent joblessness and black/white employment differential among young men. Two different approaches are taken to control for individual heterogeneity. Arrests generate some persistence in non-employment. Moreover, arrests account for nearly two-thirds of the black/white employment differential in a sample of arrestees, and nearly one-third of the difference in a more general sample. Copyright 1992 by MIT Press.

Social scientists have long concluded that premarital childbearing exacerbates problems of both poverty and family instability. Out-of-wedlock and adolescent childbearing may reduce a mothers educational attainment lower the probability of her eventual marriage increase her probability of welfare recipiency and decrease family income. The authors use an exogenous fertility event the birth of twins to estimate the economic effects of unplanned births. The approach compares the economic outcomes of women experiencing premarital twin first births to those experiencing premarital single first births in the attempt to identify the consequences of an unplanned birth upon womens future fertility and marital decisions education labor force participation labor earnings welfare receipt and poverty status. 1970 and 1980 US Census micro data are used to identify twin births to unmarried women. Analysis found large short-term effects of unplanned births on labor-force participation poverty and welfare recipiency among unwed mothers but not among married mothers. Furthermore most adverse economic effects of unplanned motherhood dissipate over time for whites but larger and more persistent negative effects weigh upon black unwed mothers.

We study the relationship between welfare benefits and the time to first marriage and time to next birth among initially unwed mothers. We use twin births to generate random within‐state variation in benefits, effectively controlling for unobservables that may confound the relationship between welfare payments and behavior. Higher base welfare benefits (1) lead unwed white mothers to forestall their eventual marriage and (2) lead unwed black mothers to hasten their next birth. The magnitudes of these effects are fairly modest. Moreover, we find no evidence that the marginal benefit paid at the birth of an additional child—the focus of the family cap debate—affects fertility.

Despite widespread popular accounts that link crack cocaine to inner-city decay, little systematic research has analyzed how the emergence of crack affected urban crime. We study this question using FBI crime rates for 27 metropolitan areas and two sources of information on when crack first appeared in those cities. Using methods designed to control for unobserved differences among metropolitan areas, we find that the introduction of crack had substantial effects on crime. In the absence of crack cocaine, the 1991 peak in urban crime rates would have been approximately 10% lower, remaining below the previous peak levels of the early 1980s.