Preferences predict who commits crime among young men.

Understanding who commits crime and why is a key topic in social science and important for the design of crime prevention policy. In theory, people who commit crime face different social and economic incentives for criminal activity than other people, or they evaluate the costs and benefits of crime differently because they have different preferences. Empirical evidence on the role of preferences is scarce. Theoretically, risk-tolerant, impatient, and self-interested people are more prone to commit crime than risk-averse, patient, and altruistic people. We test these predictions with a unique combination of data where we use incentivized experiments to elicit the preferences of young men and link these experimental data to their criminal records. In addition, our data allow us to control extensively for other characteristics such as cognitive skills, socioeconomic background, and self-control problems. We find that preferences are strongly associated with actual criminal behavior. Impatience and, in particular, risk tolerance are still strong predictors when we include the full battery of controls. Crime propensities are 8 to 10 percentage points higher for the most risk-tolerant individuals compared to the most risk averse. This effect is half the size of the effect of cognitive skills, which is known to be a very strong predictor of criminal behavior. Looking into different types of crime, we find that preferences significantly predict property offenses, while self-control problems significantly predict violent, drug, and sexual offenses.

Income and the use of prescription drugs for near retirement individuals.

In this paper, we estimate how demand for prescription drugs varies with income for a sample of near retirement individuals. The analysis is based on a novel panel data set with information about the purchase of prescription drugs for a large number of Danish individuals over the period 1995-2003. Our preferred model performs better in an external validation test than models that can be estimated on cross section data. Results indicate that demand does respond to variations in income and that reforms affecting income will therefore affect the use of prescription drugs.

Long-term labour-market performance of whiplash claimants.

A whiplash is a sudden acceleration-deceleration of the neck and head, typically associated with a rear-end car collision that may produce injuries in the soft tissue. Often there are no objective signs or symptoms of injury, and diagnosing lasting whiplash-associated disorders (WAD) is difficult, in particular for individuals with mild or moderate injuries. This leaves a scope for compensation-seeking behaviour. The medical literature disagrees on the importance of this explanation. In this paper we trace the long-term earnings of a group of Danish individuals with mild to moderate injuries claiming compensation for having permanently lost earnings capacity and investigate if they return to their full pre-whiplash earnings when the insurance claim has been assessed. We find that about half of the claimants, those not granted compensation, return to an earnings level comparable with their pre-whiplash earnings suggesting that these individuals do not have chronic WAD in the sense that their earnings capacity is reduced. The other half, those granted compensation, experience persistent reductions in earnings relative to the case where they had not been exposed to a whiplash, even when they have a strong financial incentive to not reduce earnings. This suggests that moderate injuries tend to be chronic, and that compensation-seeking behaviour is not the main explanation for this group. We find that claimants with chronic WADs used more health care in the year prior to the whiplash than claimants with non-chronic cases. This suggests that lower initial health capital increases the risk that a whiplash causes persistent WAD.