IZA DP No. 15800: Highway to Hell? Interstate Highway System and Crime
The United States witnessed an unprecedented crime wave in the second half of the twentieth century, with the total index crime rate more than tripling between 1960-1980. Little is known about the causes of this surge in criminal activity across the country. This paper investigates the role played by the Interstate Highway System (IHS), an ambitious federal government project that led to the construction of over 40,000 miles of highways between 1956-1992. Using a staggered difference-in-differences design and a county-by-year panel dataset spanning all US counties between 1960-1993, we find that a highway opening in a county led to a 5% rise in the local index crime. This effect is driven by property crime (namely larceny and motor vehicle theft), while violent crime remained unaffected. Exploring potential mechanisms, we show that the increase in crime could be explained by the positive effect of IHS on local economic development. At the same time, we find that increases in the local law enforcement size and presence in the affected communities mitigated any substantial crime surge induced by the highway construction.