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Seminarios académicos y conferencias

Martín Rossi, Universidad de San Andrés

Following the Poppy Trail: Causes and Socioeconomic Consequences of Mexican Drug Cartels

Coautor: Tommy E. Murphy

11 Octubre 2017 - 15:30 hrs.

Sala 113, Facultad de Ciencias Económicas y Administrativas UC

Abstract: We study the historical origins of Mexican cartel’s emergence and its socioeconomic consequences now-days. We trace the location of current cartels to the location of Chinese migration at the beginning of the XX century, and we document that both events are strongly connected. Using data at municipality level, we exploit the fact that Chinese immigration at the end of the century was driven by elements largely exogenous to the drug trade. Using Chinese presence in 1930 as an instrument for cartel presence today, we report a positive link between cartel presence and good socioeconomic outcomes, such as lower marginalization rates, lower illiteracy rates, higher salaries, and better public services. Results are robust to alternative definitions for cartel presence and for Chinese presence. We argue that the link between cartel presence and good socioeconomic outcomes can be interpreted in a causal way.