A dynamic model of decisions to work, invest in human capital, and commit crime was developed and examined. By making all three activities endogenous, the model explains why older, more intelligent, and more educated workers tend to commit fewer property crimes of some types than others. The model includes the following predictions: (1) policies providing education, training, and work subsidies can reduce criminal activity; however, short-term wage subsidies only temporarily reduce crime at the expense of future crime rates; (2) a rise in youth crime should accompany the recent rise in returns to skill, whereas most adult crime rates may rise or fall; and (3) law enforcement policies increase education, training, and labor supply while reducing criminal activity. When the model's testable implications were studied by analyzing data from the National Longitudinal Survey of Youth (NLSY), Current Population Survey (CPS), and Uniform Crime Reports (UCR), both ability and high school graduation were found to significantly reduce criminal participation among young men in the NLSY. Evidence from the UCR and CPS indicated that states with higher high school graduation rates and more severe punishment policies have lower index property crime rates. (Fourteen tables/figures are included. The bibliography lists 42 references.) (MN)