Literature has focused attention on identifying whether crime and violence impact growth via changes in economic factor accumulation, i.e. reducing labor supply or increasing capital costs. Yet, much little is known as to how crime and violence may affect how economic factors are allocated. Using a unique dataset created with a text-analysis algorithm of web content, this paper traces a decade of economic activity at the subnational level to show that increases in criminal presence and violent crime reduce economic diversification, increase sector concentration, and diminish economic complexity. An increase of 9.8% in the number of criminal organizations is enough to eliminate one economic sector. Similar effects can be felt if homicides rates increase by more than 22.5%, or if gang-related violence increases by 5.4%. By addressing the impact that crime has on the diversification of production factors, this paper takes current literature one step forward: It goes from exploring the effects of crime in the demand/supply of production factors, to analyzing its effects on economic composition.
Using data collected from +700 poor households impacted by Fiji’s Winston tropical cyclone in 2016, this paper examines the effect that different types of transfers (i.e. cash, in-kind, or voucher) have on how citizens evaluate government performance in post-emergency contexts. Standard economic models predict better evaluations of cash transfers. We provide evidence that contravenes these models, in that we find citizens report a more positive evaluation of government performance when non-perishable goods are provided in-kind, and perishable goods are provided as vouchers. Our model develops a more nuanced understanding of how citizens evaluate government performance and opens a discussion about the political economy motivations of emergency-relief policy design.
Grounded in a long tradition of literature that tries to identify what drives media coverage, this paper presents empirical evidence that press coverage influences the behavior of non-state actors. Particularly, using a unique data set of 1,800 communications between non-state actors in the form of drug tracking organizations (publicly displayed banners o narcomesajes), we estimate reaction functions for measures of press coverage and the intensity of credit-taken banners. We find evidence of unidirectional Granger causality from press coverage to criminal credit-taking. When press coverage increases, criminal organizations react by further increasing the number of banners publicly displayed. We attribute this effect to changes in criminal strategy: credit-taking criminals decide to become more public when they know that their public expressions will be better spread by the press. Our estimates show that a "shock" in media coverage generates up to 1.6 credit-taking banners from criminals more during the following week.
A well-functioning press is crucial for sustaining a healthy democracy. While attacks on journalists occur regularly in many developing countries, previous work has largely ignored where and why journalists are attacked. Focusing on violence by criminal organizations (COs) in Mexico, we offer the first systematic, micro-level analysis of the conditions under which journalists are more likely to be violently targeted. Contrary to popular belief, our evidence reveals that the presence of large, profitable COs does not necessarily lead to fatal attacks against the press. Rather, the likelihood of journalists being killed only increases when rival criminal groups inhabit territories. Rivalry inhibits COs’ ability to control information leaks to the press, instead creating incentives for such leaks to be used as weapons to intensify official enforcement operations against rivals. Without the capacity to informally govern press content, rival criminals affected by such press coverage are more likely to target journalists.
This article provides empirical evidence showing that when a multilevel government is well coordinated, organized crime can be more effectively controlled. Using a time-variant data set of Mexico’s cocaine markets at the subnational level and Cox proportional-hazards regressions, I show that when Mexico’s democratization decreased the probability of government coordination—the same party governing a municipality at every level of government—drug traffickers were more likely to violate the long-standing informal prohibition on selling cocaine within the country. It was this decrease in government coordination that would set the conditions for a violent war between drug cartels to erupt in the mid-2000s.
Contrary to the predictions of “power sharing” to mitigate ethnic conflicts, multicultural rights recognition can actually increase the frequency of local postelectoral mobilizations. This article demonstrates that the adoption of an ethnic rights regime for electing local government representatives may actually increase conflict if these multicultural laws are not carefully circumscribed to avoid violating human rights. Focusing on the 1995 multicultural rights reforms in Oaxaca, it presents evidence that legal changes purportedly implemented to recognize indigenous rights actually increased postelectoral disputes due to conflicts between county seat communities and peripheral population hamlets over access to funding by the central government. Based on this finding, the article addresses normative implications of “power-sharing” multiculturalism, recommending that multicultural laws be implemented only together with legal mechanisms to solve postelectoral disputes.
Mexican immigration figures have reached their lowest point since 2000. Yet, even if as a whole the United States is receiving fewer Mexican migrants, the opposite is true for cities at the border. In this article, I present evidence to show that this sui generis migration pattern cannot be understood using traditional explanations of migration dynamics. Instead, Mexicans are migrating because of security issues, in fear of drug-related violence and extortion that has spiked since 2008. I provide the first estimate of this migration pattern, showing that 264,692 Mexicans have migrated in fear of organized crime activities. In doing so, I combine the literature on migration dynamics with that on violence and crime, pointing toward ways in which nonstate actors shape actions of state members.
This article explains why homicides related to drug-trafficking operations in Mexico have recently increased by exploring the mechanisms through which this type of violence tends to escalate. It is shown that drug-related violence can be understood as the result of two factors: (a) homicides caused by traffickers battling to take control of a competitive market, and (b) casualties and arrests generated by law enforcement operations against traffickers. Both sources of violence interact causing Mexico to be locked into a “self-reinforcing violent equilibrium” in which incremental increases in traffickers’ confrontations raise the incentives of the government to prosecute traffickers which promote further confrontations with traffickers when, as a result of the detention of drug lords, the remnants of the criminal organization fight each other in successive battles. This article presents quantitative evidence and case studies to assess the importance of the two mechanisms. It uses a unique dataset of recorded communications between drug traffickers and statistics on drug-related homicides.
We develop a framework that uses Web content to obtain quantitative information about a phenomenon that would otherwise require the operation of large scale, expensive intelligence exercises. Exploiting indexed reliable sources such as online newspapers and blogs, we use unambiguous query terms to characterize a complex evolving phenomena and solve a security policy problem: identifying the areas of operation and modus operandi of criminal organizations, in particular, Mexican drug tracking organizations over the last two decades. We validate our methodology by comparing information that is known with certainty with the one we extracted using our framework. We show that our framework is able to use information available on the web to efficiently extract implicit knowledge about criminal organizations. In the scenario of Mexican drug tracking, our findings provide evidence that criminal organizations are more strategic and operate in more differentiated ways than current academic literature thought.
Violent deaths, kidnapping and extortion have spiked in Mexico’s border towns since 2004. Using a formal model and case studies from Mexico, I argue that such phenomena are partially explained by (a) a change in the politics of organized crime, (b) changes in the composition of illegal labor markets, and (c) the incentives generated at legal labor markets. With democratization, Mexico’s government became unable to keep performing its role as central enforcer of territorial boundaries between drug cartels. As cartels became guardians of their own territories, a need to recruitment new cartel members to form private armies emerged. As a result, an illegal labor market so far closed to non blood related individuals opened and modified the incentives to join/remain in the legal labor markets. The outcome was the emergence of a new generation of drug employees that (a) disdain old mafia laws, (b) are more violent and (c) are also more prone to take part of other forms of “entrepreneurial” illegal occupations such as kidnapping and extortion.
By analyzing and gathering quantitative data, this paper presents the first formal economic analysis of the impacts of the drug trafficking industry in Mexico until 2006. The analysis measures the number of drug-traffic employees, the amount of cash and investments generated by the drug-trafficking industry, the monetary costs of violence and corruption, the estimated losses in foreign investment, and the costs generated by local drug abuse. While the authors acknowledge that in some small and less diversified rural communities, drug-traffic cash flows may be helping to alleviate a grinding stage of povertyand underdevelopment, they conclude that the illegal-drug industry generates economic losses of about 4.3 billion dollars annually. Such a high figure is certainly impeding Mexican economic growth and development. Several policy options are considered.