Nber Working Paper Series the Intergenerational Effects of Parental Incarceration

We estimate the causal effect of parental incarceration on children’s medium-run outcomes using administrative data from Sweden. Our empirical strategy exploits exogenous variation in parental incarceration from the random assignment of criminal defendants to judges with different incarceration tendencies. We find that the incarceration of a parent in childhood leads to significant increases in teen crime and pregnancy and a significant decrease in early-life employment. The effects are concentrated among children from the most disadvantaged families, where teen crime increases by 18 percentage points, teen pregnancy increases by 8 percentage points, and employment at age 20 decreases by 28 percentage points. In contrast, there are no detectable effects among children from more advantaged families. These results imply that the incarceration of parents with young children may increase the intergenerational persistence of poverty and criminal behavior, even in affluent countries with extensive social safety nets. Will Dobbie Industrial Relations Section Louis A. Simpson International Bldg. Princeton University Princeton, NJ 08544-2098 and NBER wdobbie@princeton.edu Hans Grönqvist Uppsala University and IFAU Department of Economics 75120 Uppsala Sweden hans.gronqvist@nek.uu.se Susan Niknami Stockholm University SOFI 10691 Stockholm Sweden susan.niknami@sofi.su.se Mårten Palme Department of Economics Stockholm University SE-106 91 Stockholm SWEDEN and IZA Marten.Palme@ne.su.se Mikael Priks Department of Economics Stockholm University SE-106 91 Stockholm SWEDEN mikael.priks@ne.su.se There has been a dramatic rise in the number of children growing up with an incarcerated parent. In the United States, for example, the proportion of children with an incarcerated father on any given day has nearly doubled over the last twenty-five years, increasing from 1.3% of children in 1990 to 2.2% of children in 2015. The proportion of children with an incarcerated father has also roughly doubled in most European countries over this time period, albeit from a much lower level.1 Poor children are particularly likely to grow up with an incarcerated parent, with approximately 12.5% of low-income children in the United States having a parent incarcerated at some point during their childhood.2 These trends have fueled a long-standing debate on the causal effects of parental incarceration on children. Children growing up with an incarcerated parent fare worse than those without an incarcerated parent on a wide range of economic, behavioral, and educational outcomes (e.g., Murray, Farrington, and Sekol 2012). Existing studies, however, have been unable to separate the causal effects of parental incarceration from pre-existing risk factors such as living in an unstable or abusive home, attending a low-quality school, and growing up in a high-crime neighborhood (e.g., Wildeman and Western 2010). In this paper, we estimate the causal effect of parental incarceration on children’s medium-run outcomes in the context of the Swedish criminal justice system. Our work draws on two strengths of the Swedish setting. First, Swedish administrative data allow us to measure the impacts of parental incarceration for individuals who were between the ages of 11 and 14 at the time of their parent’s trial and whose outcomes we observe in each year up to age 20. We observe a wide range of important outcomes in the data, including teen criminal convictions, teen pregnancies, high school graduation, welfare receipt at age 20, and formal sector earnings and employment at age 20. The second strength of our setting is that we are able to isolate exogenous variation in parental incarceration using the random assignment of defendants to judges who differ systematically in their stringency. We measure judge stringency using a leave-out measure based on all other cases that The available data suggest that the share of children with an incarcerated father in most European countries is about one-seventh the equivalent number in the United States in any given year, with slightly lower rates in the Nordic countries. The available data vary considerably across countries, however, with parental incarceration rates in many countries being imputed using the number of male prisoners and the likelihood of each prisoner being a father. See Wildeman and Western (2010) and Children of Prisoners Europe (2017) for additional details on these data for the United States and Europe, respectively. Low-income is defined as having a total household income below the federal poverty line. Information on the cumulative risk of parental incarceration, both overall and by subsample, is not available in most European countries. In our data, we find that approximately 6.5% of low-income children in Sweden have a parent incarcerated at some point during their childhood compared to only 1.9% of all children. In Denmark, Wildeman and Andersen (2015) similarly find that 1.5% of children experience paternal imprisonment, while 8.8% experience paternal incarceration when including jail stays of less than 24 hours. See Wildeman and Western (2010) and Murphey and Cooper (2015) for additional details on the U.S. data and Wildeman and Andersen (2015) for a comparison of the cumulative risks of paternal incarceration in the United States and other developed countries.