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Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia

Gaurav Khanna, Carlos Medina (), Anant Nyshadham and Jorge A. Tamayo

No 26203, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Canonical models of crime emphasize economic incentives. 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.

JEL-codes: J24 J46 K42 (search for similar items in EconPapers)
Date: 2019-08
New Economics Papers: this item is included in nep-iue, nep-lma and nep-ure
Note: DEV LS
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Working Paper: Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia (2019) Downloads
Working Paper: Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia (2019) Downloads
Working Paper: Formal Employment and Organized Crime: Regression Discontinuity Evidence from Colombia (2018) Downloads
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