Analyzing the spatial relationship between earned income tax credit and crime rates in Chicago

Keywords: Earned income tax credit, crime
Abstract Type: Poster Abstract

Abstract

Purpose: The positive impact of the earned income tax credit’s (EITC) on employment and poverty is widely known. However, its influence on crime rates is less understood. The goal of this project was to analyze the spatial relationship between EITC filing and crime rates in Chicago, IL.

Methods: We utilized publicly available sources to retrieve property and violent crime event locations from 2015, zip code level EITC data from the Brookings and Urban Institute (TY 2014), and sociodemographic data from the 2010 U.S. Census. The median state Area Deprivation Index (ADI) rank from 2010 was also identified for each zip code. We developed a spatial error regression model to identify the relationship between EITC filing, EITC refunds, poverty, and race in relation to crime rates. We removed three outlier observations.

Results: We found statistically significant positive relationships between crime rates and the number of returns filing for EITC (325.5, p=0.02). No relationship was found between crime rates and the number of new returns filed each year (-238.9, p=0.60) nor the amount of EITC refunded (0.0006, p=0.95).

Conclusion: These findings reaffirm that there is a higher amount of EITC filers in zip codes with higher levels of all types of crime, and that efforts to encourage EITC filing among low-income populations should be bolstered. Contextualizing these results with further analysis on whether there is a reduction in crime over time and across more cities is an important next step.