Does Education Reduce Crime? Reexamining the Socioeconomic Determinants of Crime in Aceh, Indonesia

Abstract

Aceh faces a complex socioeconomic condition where rising crime rates occur alongside persistent poverty and limitations in the education system. This study investigates the effects of poverty and education on crime rates in Aceh Province, with the open unemployment rate included as a control variable. The analysis uses quarterly panel data from 2018 to 2023 across 23 regencies and cities, combined with crime data from the Indonesian National Police’s Electronic Investigation Management System. A dynamic panel approach is applied using the Generalized Method of Moments to address potential endogeneity and capture temporal effects. The findings indicate that poverty has a positive but statistically insignificant relationship with crime, suggesting that economic deprivation alone does not directly drive criminal activity in this regional context. In contrast, education, measured by average years of schooling, shows a positive and significant effect on crime rates. This result implies that increased access to formal education does not automatically reduce crime. The outcome reflects a structural mismatch between educational attainment and labor market opportunities. When graduates face limited employment prospects, unmet expectations may lead to frustration and increase the risk of deviant behavior, particularly among individuals of productive age. Unemployment also demonstrates a positive and significant effect on crime, confirming its role as a key socioeconomic driver of criminal activity. Higher unemployment reduces legitimate income opportunities and increases incentives for illegal actions. The study highlights that crime in Aceh is shaped by structural imbalances rather than by a single economic factor. Effective policy responses require integration between education reform, labor market expansion, and employment creation to address the root causes of crime