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Crime and the Economy in Mexican States; Heterogeneous Panel Estimates (1993-2012)

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  • Concha Verdugo Yepes
  • Peter L. Pedroni
  • Xingwei Hu

Abstract

This paper studies the transmission of crime shocks to the economy in a sample of 32 Mexican states over the period from 1993 to 2012. The paper uses a panel structural VAR approach which accounts for the heterogeneity of the dynamic state level responses in GDP, FDI and international migration flows, and measures the transmission via the impulse response of homicide rates. The approach also allows the study of the pattern of economic responses among states. In particular, the percentage of GDP devoted to new construction and the perception of public security are characteristics that are shown to be associated with the sign and magnitude of the responses of economic variables to crime shocks.

Suggested Citation

  • Concha Verdugo Yepes & Peter L. Pedroni & Xingwei Hu, 2015. "Crime and the Economy in Mexican States; Heterogeneous Panel Estimates (1993-2012)," IMF Working Papers 15/121, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:15/121
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    Cited by:

    1. Francesco Grigoli & Evelio Paredes & Gabriel Di Bella, 2016. "Inequality and Growth; A Heterogeneous Approach," IMF Working Papers 16/244, International Monetary Fund.
    2. Fuad Mammadov & Adigozalov Shaig, 2017. "Are fiscal rules helpful in mitigating the impact of oil market fluctuations?," IHEID Working Papers 22-2017, Economics Section, The Graduate Institute of International Studies.
    3. Cortez, Willy W. & Islas-Camargo, Alejandro, 2017. "Delincuencia, Pobreza y Crecimiento Económico en México, ¿existe una relación asimétrica?
      [Delinquency, Poverty and Economic Growth in Mexico, is there an asymmetric relationship?]
      ," MPRA Paper 80258, University Library of Munich, Germany, revised May 2017.

    More about this item

    Keywords

    Foreign direct investment; Migrations; Mexico; Panel analysis; Regional shocks; Time series; Structural vector autoregression; Crime; Panel Structural VAR; homicides; homicide; security; crimes; Macroeconomic Analyses of Economic Development; Analysis of Growth; Development; and Changes; Illegal Behavior and the Enforcement of Law;

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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