Association for Public Policy Analysis & Management

This paper evaluates the impact of quality of education on violence and crime exploiting transfers of funds from central government to municipalities as a source of exogenous variation. Using test scores as a measure of quality of education at municipality level, the paper establishes that better education has a negative impact on economic crimes such as kidnapping rates, rate of theft on persons as well as the presence of illegal armed groups. Our results are found to be consistent with an opportunity cost effect of education. High quality education may increase higher expectations of being absorbed by the labor market thereby discouraging engaging in criminal activities. Alternately, a mechanism through which education quality impacts violence could be one of a pacifying effect. Improvement of education quality may generate less violent environments, promoting social and political stability. The paper also finds a positive effect of education quality on ambush rates suggesting an indoctrination effect where education leads to indoctrination of political ideas and higher violence. However, this cannot be definitively attributed as a cause for this. The results are found to be robust to a number of econometric concerns and different measures of quality of education.