Does It Pay to Fight Crime? Evidence From the Pacification of Slums in Rio de Janeiro
66 Pages Posted: 11 Feb 2019 Last revised: 7 Apr 2019
Date Written: January 31, 2019
This paper estimates the effects of policy fighting drug gangs with official crime data. We use the pacification program of favelas in Rio de Janeiro, whose progressive rollout across several districts allows identifying its causal effects on several crime indicators. By combining a proxy variable and a simple structural model, we correct the bias resulting from the endogenous crime reporting change associated with the policy. We find that the program decreases murder rate by 7 percent, but increases assault rate by 51 percent, resulting in a rise in the total number of crimes. Our results are explained both by marginal and absolute crime deterrence effects and the fact that drug gangs secure the territories under their control.
Keywords: Criminal Governance, Reporting Bias, Pacification Policy, Drug Gangs, Brazil
JEL Classification: D73, D74
Suggested Citation: Suggested Citation