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Emergency Financial Assistance Reduces Homeless Shelter Entry and Violent Crime

A new study conducted by researchers at the Wilson Sheehan Lab for Economic Opportunities (LEO) at the University of Notre Dame shows that emergency financial assistance for people facing homelessness not only reduces shelter entry but also reduces criminal behavior.

Homelessness in the United States is a persistent and complex problem. Each year more than 2.3 million people experience homelessness, 7.4 million people live "doubled up" with friends or family for economic reasons, and many more are on the brink of homelessness.

Nearly every major U.S. city offers a hotline for people facing homelessness to request emergency financial assistance, and more than 15 million people call these hotlines every year. Linking call center information to arrest records from the Chicago Police Department, researchers found that total arrests of individuals declined between one and two years after a call for financial assistance in which they were successful in securing funds. For violent crime, fund recipients are 55% less likely to be arrested by police, with single individuals driving this decrease.

The decline in crime appears to be related, in part, to greater housing stability. Access to financial assistance significantly decreases arrests for homelessness-related outdoor crimes such as trespassing. However, the study also shows that financial assistance leads to an increase in property crime arrests. This increase is evident for family heads, but not single individuals. The increase is mostly due to shoplifting, and the timing of this increase suggests that financial assistance enables some families to take on financial obligations—such as apartment leases—that they are subsequently unable to meet.

James Sullivan, PhD, Gilbert F. Schaefer Professor of Economics at Notre Dame; David Phillips, PhD, an associate research professor; and Caroline Palmer, a LEO research assistant, led the study of the Homelessness Prevention Call Center (HPCC) in Chicago. The HPCC, which is run by Catholic Charities Chicago, is one of the largest in the nation, taking an average of 70,000 calls per year.

The study, published in the Journal of Public Economics, includes more than 8,500 individuals and families who called HPCC between 2010 and 2012. The researchers linked information from the call center to arrest records from the Chicago Police Department. Because availability of funding for the financial assistance offered by the HPCC varies, the researchers were able to look at the arrest rates of people seeking assistance when funding is available compared with those seeking assistance when no funding is available. The results indicate that policymakers should consider emergency financial assistance as an effective, evidence-based approach for preventing not only homelessness but also crime.

"We are finding that stabilizing one person in the midst of major financial crisis can benefit society as a whole," Phillips says. "Simply paying someone's rent for a month until the crisis passes not only helps that person avoid the shelter but also benefits other people who might otherwise be affected if that person's unstable situation leads to violence."

This study, funded by a grant from the National Science Foundation, builds on previous research on the HPCC by Sullivan and William Evans, PhD, Keough-Hesburgh Professor of Economics at Notre Dame. Sullivan and Evans' study was published in Science in 2016 and was the first to show that emergency financial aid significantly reduces homelessness.

Source: University of Notre Dame