The Causal Effect of Military Conscription on Crime and the Labor Market

Abstract: 

This paper uses detailed individual register data to identify the causal effect of mandatory peacetime military conscription in Sweden on the lives of young men born in the 1970s and 80s. Because draftees are positively selected into service based on their draft board test performance, our identification strategy uses the random assignment of potential conscripts to draft board officiators who have relatively high or low tendencies to place draftees into service in an instrumental variable framework. We find that military service significantly increases post-service crime (overall and across multiple crime categories) between ages 23 and 30. These results are driven primarily by young men with pre-service criminal histories and who come from low socioeconomic status households. However, we also find some evidence of an incapacitation effect concurrent with conscription for those with a pre-service criminal history. Analyses of labor market outcomes tell a similarly heterogeneous story: for instance, individuals from advantaged backgrounds have significantly higher income, while there is a negative (insignificant) effect on the income of those from disadvantaged backgrounds. Finally, we provide suggestive evidence that peer effects may play an important role in explaining the unintended negative impacts of military service.