IDEAS home Printed from https://ideas.repec.org/a/eee/jeborg/v188y2021icp828-845.html
   My bibliography  Save this article

Hindering human capital accumulation: A hidden cost of the silent mafia?

Author

Listed:
  • Caglayan, Mustafa
  • Flamini, Alessandro
  • Jahanshahi, Babak

Abstract

Since the 1970s, mafias have embedded outside South Italy though employing steadily less violence in establishing their illegal business. Could this rooting and social adaptation in the most productive areas of the country impair human capital accumulation? We provide evidence of a decline in human capital in those areas that were initially wealthy and innovative before mafias established their presence and influence. Our estimates suggest that, for the top 75% of mafia-infiltrated provinces, a reduction by 25 percentiles in their position within the mafia ranking could increase the number of university graduates per capita by 4–21%.

Suggested Citation

  • Caglayan, Mustafa & Flamini, Alessandro & Jahanshahi, Babak, 2021. "Hindering human capital accumulation: A hidden cost of the silent mafia?," Journal of Economic Behavior & Organization, Elsevier, vol. 188(C), pages 828-845.
    • Handle: RePEc:eee:jeborg:v:188:y:2021:i:c:p:828-845
    DOI: 10.1016/j.jebo.2021.05.029
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167268121002158
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jebo.2021.05.029?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Joshua D. Angrist & Alan B. Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Journal of Economic Perspectives, American Economic Association, vol. 15(4), pages 69-85, Fall.
    2. Nicola Daniele Coniglio & Giuseppe Celi & Cosimo Scagliusi, 2010. "Organized Crime, Migration and Human Capital Formation: Evidence from the South of Italy," SERIES 0028, Dipartimento di Economia e Finanza - Università degli Studi di Bari "Aldo Moro", revised Mar 2010.
    3. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    4. Daniele, Gianmarco, 2019. "Strike one to educate one hundred: Organized crime, political selection and politicians’ ability," Journal of Economic Behavior & Organization, Elsevier, vol. 159(C), pages 650-662.
    5. Giuseppe De Feo & Giacomo Davide De Luca, 2017. "Mafia in the Ballot Box," American Economic Journal: Economic Policy, American Economic Association, vol. 9(3), pages 134-167, August.
    6. Oriana Bandiera, 2003. "Land Reform, the Market for Protection, and the Origins of the Sicilian Mafia: Theory and Evidence," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 19(1), pages 218-244, April.
    7. Scognamiglio, Annalisa, 2018. "When the mafia comes to town," European Journal of Political Economy, Elsevier, vol. 55(C), pages 573-590.
    8. Campaniello, Nadia & Gray, Rowena & Mastrobuoni, Giovanni, 2016. "Returns to education in criminal organizations: Did going to college help Michael Corleone?," Economics of Education Review, Elsevier, vol. 54(C), pages 242-258.
    9. Luigi Guiso & Paola Sapienza & Luigi Zingales, 2004. "The Role of Social Capital in Financial Development," American Economic Review, American Economic Association, vol. 94(3), pages 526-556, June.
    10. Marco Di Cataldo & Nicola Mastrorocco, 2022. "Organized Crime, Captured Politicians, and the Allocation of Public Resources [“Mafiaand Public Spending: Evidence on the Fiscal Multiplier from a Quasi-Experiment]," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 38(3), pages 774-839.
    11. Meier, Stephan & Pierce, Lamar & Vaccaro, Antonino & La Cara, Barbara, 2016. "Trust and in-group favoritism in a culture of crime," Journal of Economic Behavior & Organization, Elsevier, vol. 132(PA), pages 78-92.
    12. Daron Acemoglu & Giuseppe De Feo & Giacomo Davide De Luca, 2020. "Weak States: Causes and Consequences of the Sicilian Mafia," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 87(2), pages 537-581.
    13. Daron Acemoglu & Simon Johnson & James A. Robinson, 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation," American Economic Review, American Economic Association, vol. 91(5), pages 1369-1401, December.
    14. Ufuk Akcigit & John Grigsby & Tom Nicholas, 2017. "The Rise of American Ingenuity: Innovation and Inventors of the Golden Age," Working Papers 2017-6, Princeton University. Economics Department..
    15. Philippe Aghion & Richard Blundell & Rachel Griffith & Peter Howitt & Susanne Prantl, 2009. "The Effects of Entry on Incumbent Innovation and Productivity," The Review of Economics and Statistics, MIT Press, vol. 91(1), pages 20-32, February.
    16. Uwe Sunde & Thomas Vischer, 2015. "Human Capital and Growth: Specification Matters," Economica, London School of Economics and Political Science, vol. 82(326), pages 368-390, April.
    17. Alberto Alesina & Salvatore Piccolo & Paolo Pinotti, 2019. "Organized Crime, Violence, and Politics," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 86(2), pages 457-499.
    18. valter di Giacinto & Giacinto Micucci & Alessandro Tosoni, 2018. "Knowledge intensive business services and urban areas: an analysis of localization and productivity on Italian data," Questioni di Economia e Finanza (Occasional Papers) 443, Bank of Italy, Economic Research and International Relations Area.
    19. Flamini, Alessandro & Jahanshahi, Babak & Mohaddes, Kamiar, 2021. "Illegal drugs and public corruption: Crack based evidence from California," European Journal of Political Economy, Elsevier, vol. 69(C).
    20. Dal Bã“, Ernesto & Dal Bã“, Pedro & Di Tella, Rafael, 2006. "“Plata o Plomo?†: Bribe and Punishment in a Theory of Political Influence," American Political Science Review, Cambridge University Press, vol. 100(1), pages 41-53, February.
    21. Dearmon, Jacob & Grier, Kevin, 2009. "Trust and development," Journal of Economic Behavior & Organization, Elsevier, vol. 71(2), pages 210-220, August.
    22. Joshua D. Angrist & Victor Lavy, 1999. "Using Maimonides' Rule to Estimate the Effect of Class Size on Scholastic Achievement," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(2), pages 533-575.
    23. Daron Acemoglu & James A. Robinson & Rafael J. Santos, 2013. "The Monopoly Of Violence: Evidence From Colombia," Journal of the European Economic Association, European Economic Association, vol. 11, pages 5-44, January.
    24. Steven D. Levitt, 1996. "The Effect of Prison Population Size on Crime Rates: Evidence from Prison Overcrowding Litigation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(2), pages 319-351.
    25. Gianmarco Daniele & Benny Geys, 2015. "Organised Crime, Institutions and Political Quality: Empirical Evidence from Italian Municipalities," Economic Journal, Royal Economic Society, vol. 125(586), pages 233-255, August.
    26. Daniele, Gianmarco & Dipoppa, Gemma, 2017. "Mafia, elections and violence against politicians," Journal of Public Economics, Elsevier, vol. 154(C), pages 10-33.
    27. Papke, Leslie E. & Wooldridge, Jeffrey M., 2008. "Panel data methods for fractional response variables with an application to test pass rates," Journal of Econometrics, Elsevier, vol. 145(1-2), pages 121-133, July.
    28. Federico Cingano & Fabiano Schivardi, 2004. "Identifying the Sources of Local Productivity Growth," Journal of the European Economic Association, MIT Press, vol. 2(4), pages 720-742, June.
    29. repec:fth:prinin:455 is not listed on IDEAS
    30. Rivers, Douglas & Vuong, Quang H., 1988. "Limited information estimators and exogeneity tests for simultaneous probit models," Journal of Econometrics, Elsevier, vol. 39(3), pages 347-366, November.
    31. S. Calligaris & M. Del Gatto & F. Hassan & G.I.P. Ottaviano & F. Schivardi, 2016. "Italy’s Productivity Conundrum. A Study on Resource Misallocation in Italy," European Economy - Discussion Papers 030, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    32. Maria Bigoni & Stefania Bortolotti & Marco Casari & Diego Gambetta & Francesca Pancotto, 2016. "Amoral Familism, Social Capital, or Trust? The Behavioural Foundations of the Italian North–South Divide," Economic Journal, Royal Economic Society, vol. 126(594), pages 1318-1341, August.
    33. Joshua Angrist & Alan Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Working Papers 834, Princeton University, Department of Economics, Industrial Relations Section..
    34. Paolo Pinotti, 2015. "The Economic Costs of Organised Crime: Evidence from Southern Italy," Economic Journal, Royal Economic Society, vol. 125(586), pages 203-232, August.
    35. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-565, May-June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Francesca Maria Calamunci & Federico Fabio Frattini, 2023. "When Crime Tears Communities Apart: Social Capital and Organised Crime," Working Papers 2023.08, Fondazione Eni Enrico Mattei.
    2. Paolo Buonanno & Irene Ferrari & Alessandro Saia, 2023. "ALL IS NOT LOST: Organized Crime and Social Capital Formation," Working Papers 2023: 16, Department of Economics, University of Venice "Ca' Foscari", revised 2024.
    3. Cavalieri, Marina & Finocchiaro Castro, Massimo & Guccio, Calogero, 2023. "Organised crime and educational outcomes in Southern Italy: An empirical investigation," Socio-Economic Planning Sciences, Elsevier, vol. 89(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mustafa Caglayan & Alessandro Flamini & Babak Jahanshahi, 2017. "Organized Crime and Technology," DEM Working Papers Series 136, University of Pavia, Department of Economics and Management.
    2. Giovanni Bernardo & Irene Brunetti & Mehmet Pinar & Thanasis Stengos, 2021. "Measuring the presence of organized crime across Italian provinces: a sensitivity analysis," European Journal of Law and Economics, Springer, vol. 51(1), pages 31-95, February.
    3. Cavalieri, Marina & Finocchiaro Castro, Massimo & Guccio, Calogero, 2023. "Organised crime and educational outcomes in Southern Italy: An empirical investigation," Socio-Economic Planning Sciences, Elsevier, vol. 89(C).
    4. Marco Di Cataldo & Nicola Mastrorocco, 2022. "Organized Crime, Captured Politicians, and the Allocation of Public Resources [“Mafiaand Public Spending: Evidence on the Fiscal Multiplier from a Quasi-Experiment]," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 38(3), pages 774-839.
    5. Paolo Buonanno & Irene Ferrari & Alessandro Saia, 2023. "ALL IS NOT LOST: Organized Crime and Social Capital Formation," Working Papers 2023: 16, Department of Economics, University of Venice "Ca' Foscari", revised 2024.
    6. Francesca Maria Calamunci & Federico Fabio Frattini, 2023. "When Crime Tears Communities Apart: Social Capital and Organised Crime," Working Papers 2023.08, Fondazione Eni Enrico Mattei.
    7. Daron Acemoglu & Giuseppe De Feo & Giacomo Davide De Luca, 2020. "Weak States: Causes and Consequences of the Sicilian Mafia," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 87(2), pages 537-581.
    8. Scognamiglio, Annalisa, 2018. "When the mafia comes to town," European Journal of Political Economy, Elsevier, vol. 55(C), pages 573-590.
    9. Ferrante, Livio & Reito, Francesco & Spagano, Salvatore & Torrisi, Gianpiero, 2021. "Shall we follow the money? Anti-mafia policies and electoral competition," Journal of Policy Modeling, Elsevier, vol. 43(5), pages 1110-1130.
    10. Nicola Mastrorocco, 2018. "Organised Crime, Captured Politicians and the Allocation of Public Resources," Trinity Economics Papers tep1018, Trinity College Dublin, Department of Economics.
    11. Francesca M. Calamunci & Livio Ferrante & Rossana Scebba, 2022. "Closed for mafia: Evidence from the removal of mafia firms on commercial property values," Journal of Regional Science, Wiley Blackwell, vol. 62(5), pages 1487-1511, November.
    12. Baraldi, Anna Laura & Immordino, Giovanni & Stimolo, Marco, 2022. "Self-selecting candidates or compelling voters: How organized crime affects political selection," European Journal of Political Economy, Elsevier, vol. 71(C).
    13. Gianmarco Daniele & Gemma Dipoppa, 2018. "Doing Business Below the Line: Screening, Mafias and Public Funds," BAFFI CAREFIN Working Papers 1898, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    14. Daniele, Gianmarco, 2019. "Strike one to educate one hundred: Organized crime, political selection and politicians’ ability," Journal of Economic Behavior & Organization, Elsevier, vol. 159(C), pages 650-662.
    15. Paolo Pinotti, 0. "The Credibility Revolution in the Empirical Analysis of Crime," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 0, pages 1-14.
    16. Boeri, Filippo & Di Cataldo, Marco & Pietrostefani, Elisabetta, 2022. "Localised effects of re-allocated real estate mafia assets," LSE Research Online Documents on Economics 116682, London School of Economics and Political Science, LSE Library.
    17. Paolo Pinotti, 2020. "The Credibility Revolution in the Empirical Analysis of Crime," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 6(2), pages 207-220, July.
    18. Anna Laura Baraldi & Erasmo Pagani & Marco Stimolo, 2022. "Neutralizing the Tentacles of Organized Crime. Assessment of an Anti-Crime Measure in Fighting Mafia Violence," Working Papers 2022.18, Fondazione Eni Enrico Mattei.
    19. repec:zbw:bofitp:2020_024 is not listed on IDEAS
    20. Lonsky, Jakub, 2020. "Gulags, crime, and elite violence : origins and consequences of the Russian mafia," BOFIT Discussion Papers 24/2020, Bank of Finland, Institute for Economies in Transition.
    21. Baraldi, Anna Laura & Papagni, Erasmo & Stimolo, Marco, 2022. "Neutralizing the Tentacles of Organized Crime. Assessment of an Anti-Crime Measure in Fighting Mafia Violence," FEEM Working Papers 322775, Fondazione Eni Enrico Mattei (FEEM).

    More about this item

    Keywords

    Organised crime; Mafia; Human capital; Education; Tertiary education;
    All these keywords.

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jeborg:v:188:y:2021:i:c:p:828-845. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jebo .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.