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Weak States: Causes and Consequences of the Sicilian Mafia

Author

Listed:
  • Acemoglu, Daron
  • De Feo, Giuseppe
  • De Luca, Giacomo

Abstract

We document that the spread of the Mafia in Sicily at the end of the 19th century was in part shaped by the rise of socialist Peasant Fasci organizations. In an environment with weak state presence, this socialist threat triggered landholders, estate managers and local politicians to turn to the Mafia to resist and combat peasant demands. We show that the location of the Peasant Fasci is significantly affected by an exceptionally severe drought in 1893, and using information on rainfall, we establish the causal effect of the Peasant Fasci on the location of the Mafia in 1900. We provide extensive evidence that rainfall before and after this critical period has no effect on the spread of the Mafia or various economic and political outcomes. In the second part of the paper, we use the source of variation in the location of the Mafia in 1900 to estimate its medium-term and long-term effects. We find significant and quantitatively large negative impacts of the Mafia on literacy and various public goods in the 1910s and 20s. We also show a sizable impact of the Mafia on political competition, which could be one of the channels via which it affected local economic outcomes. We document negative effects of the Mafia on longer-term outcomes (in the 1960s, 70s and 80s) as well, but these are in general weaker and often only marginally significant. One exception is its persistent and strong impact on political competition.

Suggested Citation

  • Acemoglu, Daron & De Feo, Giuseppe & De Luca, Giacomo, 2017. "Weak States: Causes and Consequences of the Sicilian Mafia," CEPR Discussion Papers 12530, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:12530
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    References listed on IDEAS

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    Cited by:

    1. repec:zbw:ifweej:201845 is not listed on IDEAS
    2. Tomás E. Murphy & Martín Rossi, 2017. "Following the Poppy Trail: Causes and Consequences of Mexican Drug Cartels," Working Papers 130, Universidad de San Andres, Departamento de Economia, revised Dec 2017.
    3. Nicola Mastrorocco, 2018. "Organised Crime, Captured Politicians and the Allocation of Public Resources," Trinity Economics Papers tep1018, Trinity College Dublin, Department of Economics, revised Jan 2019.
    4. Hale Utar, 2018. "Firms and Labor in Times of Violence: Evidence from the Mexican Drug War," CESifo Working Paper Series 7345, CESifo Group Munich.

    More about this item

    Keywords

    criminal organizations; economic development; Mafia; Political Competition; weak states;

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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