Most of the socio-economic studies indicated that unemployment within the economics of crime studies is positively related to crime. Committing crime without failing while unemployed has a higher reward (Burdett et al, 2004). Unemployment shows lack of opportunity for participation in the labour market and the acquisition of legitimate earnings (Freeman, 1999).
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The exclusion from legitimate income opportunities raises the expected returns from crime, the economics of crime theories have confirmed. Although, most of the empirical studies show a positive relationship between unemployment and crime (Snipes, 2002). In the study, Saridakis (2004) used the period of unemployment to investigate the linked between violent crime. The findings revealed that an insignificant relationship between unemployment period and violent crime. Which is contrary to the findings of Carmichael and Ward,(2001) unemployment had a significant effect on violent crime. Similarly, Elliot and Ellingworth (1996) examined the effect of unemployment and crime in British in 1992 Crime Survey. The results show that unemployment has an insignificant relationship.
However, Field (1990) applied time-series data for England and Wales from 1952 and 1987. The results show an insignificant relationship between crime and unemployment. Marris (2000) recommend that, in order to determine the relationship between unemployment and crime, the difference between voluntary and involuntary unemployment should be differentiated in the labour market. Fougère et al.,( 2006) also found a negative relationship between unemployment and crime in France. Some other research for the United States by Greenberg (2001); Raphael & Winter- Ebmer (2001) and Entorf & Spengler,(2000) have reported a negative relationship between unemployment and violent crimes such as murder and rape. Lee, (2003) conducted an investigation to determine the relationship between unemployment and crime in Korea. The results found a strong evidence of long-run relationship exists between unemployment and the total crime, violent and property crime. In Japan, Lee (2003) found that unemployment exhibits a long run relationship with murder and rape. The crime economic model, particularly in time-series concept predict that increase of unemployment rates raise crime because the individual is willing to engage in the criminal activities because of the positive return obtained from illegal are higher than the legal ones (Narayan and Smyth, 2004 and Levitt, 2001). An increasing unemployment rate creating more economic hardship in the economic, increase in the level of unemployed in the economy resulting in a high rate of criminal activities (Edmark, 2003 and Gould, 2000).
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