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On-line version ISSN 2007-9869Print version ISSN 1870-6622


CORONA JUAREZ, Nicolás. 14 years later: The spread of drug crime in Mexico. EconoQuantum [online]. 2014, vol.11, n.2, pp.07-40. ISSN 2007-9869.

Over the past five years public security in Mexico started to become one of the first problems for civil society and authorities. Analysts have warned that insecurity is spreading to regions that were previously unaffected. Applying spatial econometrics techniques, this paper empirically investigates whether and how drug related crime in a given Mexican state spreads to its neighboring states. Using a panel data set for the 31 Mexican federal states and Mexico City over the period 1997-2010 the papers finds a positive and significant diffusion effect of crimes related to drugs after controlling for political and socio-economic characteristics of regions. These findings take into account the endogeneity inherent to the spatial autoregression implementing a 2SLS estimation procedure and are robust to the selection of the spatial lag weighting matrix. Furthermore, after controlling for drug enforcement in neighboring states to state i, the results show weak evidence for a deterrent effect. This implies that authorities' deterrence measures in neighboring states to state i weakly reduce drug crimes in state i.

Keywords : Drug Crimes; Mexico; Spatial Econometrics; Panel Data.

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