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

40 Pages Posted: 13 Jan 2022

See all articles by Giacomo Battiston

Giacomo Battiston

Free University of Bolzano-Bozen

Gianmarco Daniele

University of Milan - Faculty of Law; Bocconi University

Marco Le Moglie

Catholic University of the Sacred Heart of Milan; Bocconi University

Paolo Pinotti

Bocconi University - BAFFI Center on International Markets, Money, and Regulation

Date Written: January 13, 2022

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.

Keywords: Organized crime, War on Drugs, Oil thefts, Leapfrogging

JEL Classification: K42, L20

Suggested Citation

Battiston, Giacomo and Daniele, Gianmarco and Le Moglie, Marco and Pinotti, Paolo, Fueling Organized Crime: The Mexican War on Drugs and Oil Thefts (January 13, 2022). BAFFI CAREFIN Centre Research Paper No. 2022-171, Available at SSRN: https://ssrn.com/abstract=4007993 or http://dx.doi.org/10.2139/ssrn.4007993

Giacomo Battiston

Free University of Bolzano-Bozen ( email )

Piazza Universita 1
Bolzano, 39100
Italy

Gianmarco Daniele (Contact Author)

University of Milan - Faculty of Law ( email )

Via Festa del Perdono, 7
20122 Milano
Italy

Bocconi University ( email )

Via Sarfatti 25
Milan, MI 20136
Italy

Marco Le Moglie

Catholic University of the Sacred Heart of Milan ( email )

Largo Gemelli, 1
Via Necchi 9
Milan, MI 20123
Italy

Bocconi University ( email )

Via Roentgen 1
Milan, 20136
Italy

Paolo Pinotti

Bocconi University - BAFFI Center on International Markets, Money, and Regulation ( email )

Milano, 20136
Italy

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