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Fernando Borraz and Ignacio Munyo
''Conditional Cash Transfers and Crime: Higher Income but also Better Loot''
( 2020, Vol. 40 No.2 )
We quantify the effect of conditional cash transfer programs on crime. We find a positive correlation between welfare payments in cash significantly and criminal activities. We exploit the exogenous increase in the payment and the number of beneficiaries given by a major reformulation of the CCT program in Uruguay. The increase in crime is exclusively observed in property crime suggesting the impact is driven by economic reasons. Our findings suggest that an increase in cash available on the streets improves the loot from crime and thus increases the incentive for illegal activities.
Keywords: Conditional cash transfers, crime, income effect, loot
JEL: H5 - National Government Expenditures and Related Policies National Government Expenditures and Related Policies: General
I3 - Welfare and Poverty: General
Manuscript Received : Apr 28 2020 Manuscript Accepted : Jun 24 2020

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