Does Crime Lower Growth?

Mauricio Cardenas and Sandra Rozo

No 28005 in World Bank Publications - Books from The World Bank Group

Abstract: Many analysts consider that lack of security is a major obstacle to growth in Colombia. This paper identifies a structural downturn in economic growth-of nearly two percentage points per year-as a result of the increase in illicit crops and crime rates after 1980. A decline in total factor productivity has been the key channel linking crime and economic growth. Political upheavals and high levels of inequality and poverty motivated the adoption of a new constitution in 1991. The constitution mandated additional fiscal expenditures to curb social tensions. Major progress has been made in terms of public safety and, to a lesser extent, in the provision of health and education. However, long?run growth will continue to be constrained by inadequate transport infrastructure and low international trade volumes.

Keywords: Macroeconomics; and; Economic; Growth-Economic; Growth; Macroeconomics; and; Economic; Growth-Economic; Theory; &; Research; Poverty; Reduction-Achieving; Shared; Growth; Social; Development-Crime; and; Society (search for similar items in EconPapers)
Date: 2008
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Citations: View citations in EconPapers (10)

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