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Fueling Organized Crime: The Mexican War on Drugs and Oil Thefts

Author

Listed:
  • Battiston, Giacomo
  • Daniele, Gianmarco
  • Le Moglie, Marco
  • Pinotti, Paolo

Abstract

We show that the War on Drugs launched by the Mexican President Felipe Calderón in 2007 pushed drug cartels into large-scale oil thefts. Municipalities that the presidential candidate's party barely won at the local elections in 2007-2009 exhibit a larger increase in illegal oil taps over the following years, compared to municipalities in which the presidential candidate's party barely lost the elections. Challenger cartels in the drug market leapfrog incumbent drug cartels when entering the new illegal activity, analogous to what is typically observed in legal markets. Since challengers and incumbents specialize in different criminal sectors, the expansion of challengers does not increase violence in municipalities traversed by oil pipelines. At the same time, the municipalities traversed by a pipeline witness a decrease in schooling rates.

Suggested Citation

  • Battiston, Giacomo & Daniele, Gianmarco & Le Moglie, Marco & Pinotti, Paolo, 2022. "Fueling Organized Crime: The Mexican War on Drugs and Oil Thefts," CEPR Discussion Papers 16914, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:16914
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    Cited by:

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    2. Cruz, Iván López & Torrens, Gustavo, 2026. "A two-wave death story: fentanyl overdoses in the US, bullets in Mexico," Journal of Development Economics, Elsevier, vol. 178(C).
    3. Vlado Vivoda & Ghaleb Krame & Martin Spraggon, 2023. "Oil Theft, Energy Security and Energy Transition in Mexico," Resources, MDPI, vol. 12(2), pages 1-15, February.
    4. Daniele, Gianmarco & Le Moglie, Marco & Masera, Federico, 2023. "Pains, guns and moves: The effect of the U.S. opioid epidemic on Mexican migration," Journal of Development Economics, Elsevier, vol. 160(C).
    5. López Cruz, Iván & Torrens, Gustavo, 2023. "Hidden drivers of violence diffusion: Evidence from illegal oil siphoning in Mexico," Journal of Economic Behavior & Organization, Elsevier, vol. 206(C), pages 26-70.

    More about this item

    Keywords

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    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General

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