DP9911 | The Importance of Family Background and Neighborhood Effects as Determinants of Crime

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We quantify the importance of family background and neighborhood effects as determinants of criminal convictions and incarceration by estimating sibling and neighborhood correlations. At the extensive margin, factors common to siblings account for 24 percent of the variation in criminal convictions and 39 percent of the variation in incarceration. At the intensive margin, these factors typically account for slightly less than half of the variation in prison sentence length and between one-third and one-half of the variation in criminal convictions, depending on crime type and gender. Neighborhood correlations, on the other hand, are quite small. We, therefore, conclude that these large sibling correlations are most likely generated by family influences and not by neighborhood influences. Further analysis shows that parental criminality and family structure contribute more to sibling similarities in crime than parental income and education or neighborhood characteristics. The lions? share of the sibling crime correlations, however, are unexplained by these factors. Finally, sibling spacing also matters ? more closely spaced siblings are more similar in their criminal behavior.