Crime and Human Capital in India

It has been demonstrated that violent crime has profound effects on a number of socioeconomic outcomes. But, does day-to-day crime also shape human capital accumulation? We answer this question in the Indian context by combining multiple years of district-level data on the incidence of various types of crime with a nationally representative survey on learning achievement of school-aged children. Our empirical strategy leverages the within-district across-year variation in crime to estimate the crime-learning gradient. We show that an increase in violent crime is associated with lower achievement in reading and math, while non-violent crimes have no discernible correlation with learning outcomes. The effects are short-lived, driven by contemporaneous crime, and are similar for boys and girls. Additionally, we find that violent crimes impose greater costs on learning of children from socioeconomically disadvantaged households. We find evidence that both household-level factors (reduced child mobility and poorer mental health) and school-level factors (lower availability of teachers) are possible mechanisms underpinning these findings.