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Spotlight on Economics: Oil Boom and Crime

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Siew Lim, associate professor, NDSU Agribusiness and Applied Economics Department (NDSU photo) Siew Lim, associate professor, NDSU Agribusiness and Applied Economics Department (NDSU photo)
Tackling crime problems in rural boomtowns requires policies and strategies that respond to communities’ needs.

By Siew Hoon Lim, Associate Professor

NDSU Agribusiness and Applied Economics Department

The rise and fall of shale oil production in recent years have led to tremendous economic growth and challenges to shale communities across the country.

Clearly, the 2000s oil and gas boom was not the first energy boom for the U.S. or North Dakota.

Past studies have shown that an energy boom in shale-rich regions tends to bring social disruption, such as criminal activities, to the local, and especially rural, communities. In North Dakota, local officials reported an increase in crime along with the influx of workers in the Bakken oil patch. But the transient nature of the new population made tracking them down hard for local authorities.

My recent research found that shale oil activities at the Bakken are linked to more property crime in the oil-producing counties. I found statistically significant evidence of increased aggravated assaults, burglaries, larcenies and motor vehicle thefts in shale oil-producing counties during the boom.

The number of aggravated assaults was at least 3.7 times higher in the shale oil counties during the boom, followed by the number of motor vehicle thefts (about two times higher), larcenies (1.8 times higher) and burglaries (1.5 times higher). However, the rise in certain violent crime (murder and rape) is not statistically attributable to the shale oil boom or oil activity.

The increase in crime may be explained by a number of factors. The Bakken oil boom occurred during the time when the rest of the U.S. was experiencing high unemployment rates. Consequently, a sudden influx of young male migrant workers to sparsely populated rural communities during the boom period may have fueled the rise of crime when local public resources and businesses were strained by rapid population growth.

Another potential factor, according to a study conducted by researchers at the University of Alaska-Anchorage and Montana State University, is criminal migration. “Criminally prone” individuals and convicted felons, who would have difficulties finding jobs elsewhere, could get employment more easily in boomtowns that have a high demand for labor. Their study also found that the shale oil boom increased income inequality.

Concerns about the oil boom and bust in rural communities point to the need for adequate and effective response to shocks. All in all, tackling crime problems in rural boomtowns requires policies and strategies that respond to communities’ needs, as well as members of the communities themselves to work together.

Furthermore, understanding the importance of opportunity in relation to crime is fundamental to crime prevention. When the chances of being caught are small, but the opportunities for criminal violations are present, the communities’ crime reduction resources should be focused on reducing potential opportunities for crime.

Lastly, investment in public services to enhance community safety and security may be necessary, but insufficient, to reduce crime in energy boom communities. But coupled with strong communities’ sense of togetherness and belonging, a sudden influx of a new population creates opportunities for local nonprofit groups and charities to work together with public assistance in meeting the needs of long-term and new residents, and to improve community interaction and integration.


NDSU Agriculture Communication - June 13, 2018

Source:Siew Lim, 701-231-8819, siew.lim@ndsu.edu
Editor:Ellen Crawford, 701-231-5391, ellen.crawford@ndsu.edu
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