Policing, schooling and human capital accumulation

A substantial body of empirical literature argues that greater investment in schools can lower criminality and violence. On the other hand, recent work demonstrates that low levels of public safety can have serious detrimental effects on educational outcomes. This paper develops a model to analyze the roles that investments in education and public safety have for student's educational attainment, and explores the optimal balance between the two public programs. I analyze individual decisions to acquire violence related skills at the expense of human capital accumulation in a setting where the former serves to protect one's property or expropriate that of others. Therefore, if the level of public safety, which prevents violent confrontations, is low, the incentives to study will also be lower. Moreover, the agents who accumulate more human capital and hence are more productive suffer a comparative disadvantage in exerting violence because their opportunity cost of doing so is higher. I show that if investments in public education increase the productivity spread between adult agents of different ability, the incentives to study might further decrease and lead to a lower output, showing that the benefits of schooling can only be seized if they are complemented with enough public safety. (C) 2017 Elsevier B.V. All rights reserved.