Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia

Gaurav Khanna, Carlos Medina, Anant Nyshadham and Jorge Tamayo
Additional contact information
Jorge Tamayo: Harvard Business School

No 520, Working Papers from Center for Global Development

Abstract: Canonical models of crime emphasize economic incentive. Yet, causal evidence of sorting into criminal occupations in response to individual-level variation in incentives is limited. We link administrative socioeconomic microdata with the universe of arrests in Medellín over a decade. We exploit exogenous variation in formal-sector employment around a socioeconomic-score cutoff, below which individuals receive benefits if not formally employed, to test whether a higher cost to formal-sector employment induces crime. Regression discontinuity estimates show this policy generated reductions in formal-sector employment and a corresponding spike in organized crime, but no effects on crimes of impulse or opportunity.

Keywords: organized crime; informality; occupational choice; gangs; Medellin (search for similar items in EconPapers)
JEL-codes: J24 J46 K42 (search for similar items in EconPapers)
Pages: 58 pages
Date: 2019-10-31
New Economics Papers: this item is included in nep-iue, nep-lam, nep-law and nep-ure
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Citations: View citations in EconPapers (7)

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https://www.cgdev.org/publication/formal-employmen ... ty-evidence-colombia

Related works:
Journal Article: Formal Employment and Organised Crime: Regression Discontinuity Evidence from Colombia (2023)
Working Paper: Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia (2019)
Working Paper: Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia (2019)
Working Paper: Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:cgd:wpaper:520

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