Monday, January 16, 2017

Jennifer Doleac and Benjamin Hansen

First, let me tell you about the authors. Professor Hansen is a visiting research scholar at Crime Lab New York, here in New York City, while he is on sabbatical from his position as an Associate Professor at the University of Oregon. He is also a research associate at the National Bureau of Economic Research and  research fellow at IZA, the Institute for the Study of Labor Economics. He specializes in the Economics of risky behaviors. This includes substance abuse, drunk driving and alcohol use and abuse. He also studies the use of drugs that were illegal and are becoming legal, like the timely case of marijuana; and the economics of criminality.  Professor Doleac is an Assistant Professor of Public Policy and Economics at the University of Virginia, and a Nonresident Fellow in Economic Studies at the Brookings Institution. She’s also an Affiliate at the University of Chicago Crime Lab. She studies crime and discrimination; and she’s finding that these two areas of interest have become overlapping, as you will see in the example we study below. In her work on crime she often looks at how new technologies can affect public safety.

In this paper, the authors discuss a policy called “Ban the Box,” or BTB for short. The goal of BTB is to help people with criminal records find a job. It has this name because typically, especially for low wage jobs, there is a box that potential employers ask applicants to check, when they fill out a job application, if they have a criminal record. Often potential employers are reluctant to hire anyone who checks this box. So, the idea of BTB is to hide this information at the beginning of the process, and instead reveal it at the end, right before an offer might be made. This will give the applicant a chance to put his or her best foot forward, a chance to establish a good rapport with the employer, increasing the chance to be hired, despite the criminal record.

Why is this important? It’s important because there is evidence of high recidivism rates among the prison population. That is, too many people end up committing another crime, and back in jail. And securing employment is an essential way to build a stable life, preventing this recidivism.

The authors are able to assess the effects of BTB because it took effect in different cities at different times. Unfortunately, they don’t have data on individual workers and whether each has a criminal record. So, here’s what they do. They focus on a portion of the population they think will be most affected by this policy: young males without a college degree (low skilled workers). They compare the share of this population that is working where the policy was adopted later to the share that is working where it was adopted earlier. What they find is that, in particular, minorities (blacks and Hispanics) in this group experience a reduction in employment after the policy is in place.

What’s going on here? This policy completely backfires! When BTB is implemented, according to Professor Doleac, “the policy itself doesn’t do anything to change employers’ feelings about hiring someone with a criminal record. If employers don’t want to hire someone with a criminal record, then when they can’t see who has a record, they might try to guess who has a record. Because interactions in the criminal justice system in this country are so highly correlated with race, we might expect that employers would discriminate against young, low skilled black and Hispanic men.”  The reduction in employment was about 5% for young black men and about 3% for young Hispanic men. These are pretty big numbers.  

In social-science-speak this unintended consequence is the result of statistical discrimination on the parts of the employers. This happens when members of a particular group are discriminated against because information is missing about them. So, the observer is forced to use only the information available. The easily available information, race in this case, is used in place of, as a substitute for, the missing information. The very policy that was meant to help those with a criminal record turns out to hurt them, and it hurts others who don’t even have a criminal record!

It certainly seems that withholding information from employers isn’t the right policy in this case. Professors Doleac and Hansen would recommend instead giving employers more information. Instead of a BTB policy, they would recommend a policy in which a criminal history is revealed along with what it means. For example, employers need to understand the different crimes, and whether they might be related to job performance. Previous work has shown that when employers are allowed to gather more information on minorities, it helps the minority job seekers in their quest to find work.  This makes a lot of sense. One paper found that potential employers banned from conducting credit checks on job applicants used race as a proxy for credit score, and employment for blacks fell by at least 7%. 

I asked the authors about their related work. Professor Hansen has another paper on the effects of a criminal history on employment. He examines what happens if blood alcohol content (BAC) threshold cutoffs are removed. With a BAC cutoff of 0.080, someone who gets stopped and measures 0.081 gets a DUI, but someone with 0.079 just gets reckless driving. He is interested in how much of a difference this criminal history makes when each person searches for a job.

Professor Doleac is interested in how to improve prisoner re-entry. She is currently studying a new program that uses technology to help inmates develop a transition plan for when they are released from jail or prison, then provides additional information and reminders (or “nudges” in behavioral economics lingo) to help them stay on track after they get out. The program addresses a number of areas that can be challenging for this group – including finding a place to live, enrolling in school, getting a job, accessing health care and substance abuse treatment, and finding reliable child care.

Let’s talk! I would love to know what you think about this example of unintended consequences. Please submit comments and questions.