The seminar will discuss how post‑2016 surge in U.S. tequila demand causally increase crime in Mexican producing regions.
We show how the surge in the demand for Tequila in the US starting 2016 has caused crime to increase in the producing regions in Mexico. Using a shift-share instrument we can identify the causal effect of this persistent demand shock on property crimes and extortion, but neither homicides nor cartel presence increased significantly. Our findings are consistent with cartels diversifying their activities in response to increased rents, but not with increased turf wars.
Event Speakers
Günther G. Schulze
University of Freiburg