Blood Avocados: Trade Liberalization and Cartel Violence in Mexico

• In Event: State Politics and Policy & New Directions in Political Economy Virtual Poster Session
  In Virtual Poster Session: New Directions in Political Economy Virtual Poster Session

Abstract

Does the expansion of licit markets enable criminal groups to capture rents from trade to fund and facilitate violent enterprises? The existing literature has primarily focused on the inverse – how crime impacts economic growth. Common assumptions furthermore hold that cartels will seek market power through competition, manifesting in violence related to turf war and signaling. Our findings on the expansion of the avocado market in Mexico demonstrate that the opposite is true – positive shocks to the demand for avocados through policies of trade openness led to a decrease in cartel-related homicides. We interpret this finding as consistent with an extralegal justice hypothesis, whereby there is bottom-up approach to order as vigilante groups emerge to contest the reach of gangs in local communities. Using a difference-in-differences design, we find that trade liberalizing policies in Mexico between 2011 and 2019 expanded international demand for avocados to municipalities formerly unable to export, which led to a decrease in cartel-related homicides compared to municipalities that were unaffected by these policy changes. Next, we qualitatively demonstrate that vigilante groups emerge to counter gang control and maintain local order, supporting our extralegal justice hypothesis. This paper contributes to the literature on trade and organized crime by examining how trade expansion impacts the prevalence of extralegal groups as cartels and vigilante groups pursue strategies of market competition.

Authors

• Megan Erickson, University of Washington

• Lucas Owen