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Holzer et al. (2007) also suggest that inequalities, such as poverty, which are passed on
through generations can be attributed 40 per cent to hereditary reasons, and 60 per cent to other
factors, such as environment. Therefore, if we are able to provide better opportunities for
educational attainment for children in disadvantaged environments we are then likely to have
made a significant difference in improving both their lives and overall societal outcomes.
ii. Crime
Many studies show a strong linkage between low income and crime. For example, Holzer
et al. (2007:18) estimate that poverty was responsible for 40 per cent of crimes in the United
States. Elliot and Ageton (1980) also show the predisposition of disadvantaged youth and their
participation in crime. They calculate that lower class youth committed nearly four times as
many violent crimes as middle class youth. The reduction of poverty through higher levels of
education attainment would thus result in lower level of crime and a fall in the costs associated
with crime.
In addition to the relation between poverty and crime, researchers have also found that
increased educational attainment directly reduces crime. Lochner and Moretti (1997) looked at
the effects of education on crime through Census and FBI data in the United States and found a
negative correlation between years of education and the rate of incarceration and arrest. The
authors found that increased schooling significantly reduces the probability of incarceration and
arrest.6 More specifically, Lochner and Moretti found that incarceration rates decline with
schooling beyond the eighth grade, with the largest decline occurring after high school
graduation. They also showed that in the United States, White males7 in states with 11 or more
years of compulsory school attendance historically have a dropout rate 5.5 per cent below that of
White males in states with eight or less years of required attendance (Lochner and Moretti,
2004:164). Therefore, because high school graduation is associated with lower incarceration
rates, they believe that compulsory schooling laws are beneficial. More importantly, they find
that increasing the graduation rates of children from disadvantaged environments has an even
higher rate of return than for average children since the reduction in criminal activity from higher
educational attainment is generally larger for disadvantaged youth.8
The most basic explanation as to why higher levels of education reduce the levels of
crime is related to finances. A worker with a higher level of education has a greater likelihood of
receiving a higher wage. First, this would decrease the need to commit crimes for financial
gains. Second, if earnings are higher, there is a higher opportunity cost associated with the
possibility of being caught and punished for criminal activity. There may also be more of a
stigma around criminal behavior for well educated workers than for poorly educated workers.
6 Interestingly, they also controlled for the possibility of increased leniency due to a person‘s education background,
but the results remained unchanged as prison sentences for the same crime were found to be similar among both
high school dropouts and graduates.
7 White males 20-60 years from the US censuses 1960, 1970, and 1980. Size of 3,209,138 individuals.
8 Lochner and Moretti (1997) estimate that one extra year of schooling reduces the probability of incarceration by
0.1 percentage-points for whites and 0.37 percentage-points for blacks. They also estimated that one more year in
the average level of schooling reduces overall arrests by 11 per cent. They showed that a Black high school graduate
had a 3.4 percentage point lower probability of incarceration than a Black dropout, while White graduates had a 0.76
percentage point lower probability of incarceration than White dropouts.