Parents, neighbors and youth crime

We study the interplay between parental and peer socialization in shaping criminal behavior among adolescents. We develop a simple cultural transmission model where parents affect how the society influences their children's decision. The model predicts that parental and peer socialization are substitutes in the development of juvenile crime. We then take the model to the data using information on a representative sample of adolescents in the United States. Using the geographic distances between residential addresses of individuals in the same grade and school to measure peer influences, we find that negative peer effects on juvenile crime are significantly lower for teenagers with engaged mothers. Consistent with the prediction of our model, this evidence reveals an important role of parents in mediating the impact of neighborhoods on youth crime. The influence of parents is especially important for drug trafficking, assault and battery.