Latest research examines link between violence and economic growth

Program on Poverty and Governance director Beatriz Magaloni, associate professor of political science and FSI senior fellow, post-doctoral fellow Gabriela Calderón and graduate student Gustavo Robles were recently featured in an Inter-American Development Bank (IDB) report for their participation in a research group for the IDB's Citizen Security Research Platform. Their project, entitled "The Economic Consequences of Drug-Trafficking Violence in Mexico," seeks to quantify the local economic impact of Mexico's drug war across the country.

The study uses electricity consumption as a proxy for per-capita gross domestic product to calculate the impact of violence on economic output in Mexico. The research team found that when municipalities become embroiled in high levels of drug violence, local electrical consumption drops. They also examined census employment statistics to measure the impact of violence on the number of people employed or actively seeking employment. Their research has suggested that citizens are increasingly hesitant to launch businesses, and may even choose unemployment over risking the daily walk to work in a highly insecure environment.

The team presented their work for a seminar at the IDB's Washington, D.C., headquarters as part of the project "The Cost of Crime and Violence in Latin America and the Caribbean" on Jan. 23-24, 2013.

Click below for a working draft of the paper available in both Spanish and English.