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

By Concha Verdugo Yepes, Peter L. Pedroni, Xingwei Hu

June 4, 2015

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Concha Verdugo Yepes, Peter L. Pedroni, and Xingwei Hu. Crime and the Economy in Mexican States: Heterogeneous Panel Estimates (1993-2012), (USA: International Monetary Fund, 2015) accessed September 19, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

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.

Subject: Balance of payments, Crime, Econometric analysis, Foreign direct investment, Migration, Population and demographics, Structural vector autoregression, Vector autoregression

Keywords: Caribbean, Crime, Crime incidence data, Crime shock, Crime variable, Economic activity shock, Foreign direct investment, Global, Homicide rate, Impulse response, Mexico, Migration, Migration shock, Panel Structural VAR, State level, Structural vector autoregression, Vector autoregression, Western Europe, WP

Publication Details

Pages:

59
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2015/121
Stock No:

WPIEA2015121
ISBN:

9781513541969
ISSN:

1018-5941

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