Wandering Astray: Teenages' Choices of Schooling and Crime

We build and estimate a dynamic model of teenagers� decisions of schooling and crime, featuring four choice-driving factors: heterogeneous endowments, unequal opportunities, uncertainties about oneself, and contemporaneous... [ view full abstract ]

We build and estimate a dynamic model of teenagers� decisions of schooling and crime, featuring four choice-driving factors: heterogeneous endowments, unequal opportunities, uncertainties about oneself, and contemporaneous shocks. We estimate the model using administrative data from Chile that link school records with criminal records in teenage years. We use the estimated model to examine the effectiveness of counterfactual policies that aim at keeping teenagers �on track�and reducing inequality.