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The Spatial Impact of Judicial Administration on Firms' Performance

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  • Vincenzo Sessa

Abstract

This paper investigates the indirect effects of judicial adminstration (JA) on neighbouring firms operating in southern Italian regions characterised by endemic organised crime. When a mafia‐affiliated firm is placed under JA, the sector‐specific relational networks it sustained are abruptly severed. Using difference‐in‐differences estimators, we find negative spillovers on other firms operating within a 10‐km radius of the sanctioned enterprise: average cumulative effects of −2.27% on revenues, −2.08% on employment, and −4.98% on value added. Effects intensify with sectoral proximity and attenuate with physical distance, consistent with the disruption of territorially embedded mafia networks.

Suggested Citation

  • Vincenzo Sessa, 2026. "The Spatial Impact of Judicial Administration on Firms' Performance," LABOUR, CEIS, vol. 40(3), pages 263-290, September.
    • Handle: RePEc:bla:labour:v:40:y:2026:i:3:p:263-290
    DOI: 10.1111/labr.70019
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