Mica Sviatschi

Maria Micaela (Mica) Sviatschi is an Assistant Professor of Economics at Princeton University.

Date: October 29, 2019

Bonus segment on Professor Sviatschi’s career path and life as a researcher.

A transcript of this episode is available here.

Episode Details:

In this episode, we discuss Professor Sviatschi's work on the effects of criminal gangs on economic development in El Salvador:

"Gangs, Labor Mobility, and Development" by Nikita Melnikov, Carlos Schmidt-Padilla, and Maria Micaela Sviatschi. (Draft available from the authors upon request.)

OTHER RESEARCH WE DISCUSS IN THIS EPISODE:

• “Legitimacy in Criminal Governance: Managing a Drug Empire from Behind Bars” by Benjamin Lessing and Graham D. Willis.

• "The Logic of Violence in Drug Wars: Cartel-State Conflict in Mexico, Brazil and Colombia" by Benjamin Lessing.

• “Killing in the Slums: Social Order, Criminal Governance, and Police Violence in Rio de Janeiro” by Beatriz Magaloni, Edgar Franco Vivanco, and Vanessa Melo.

• The Gangs that Cost 16% of GDP

• “Micro-Extortion by Gangs is Costing El Salvador Millions of Dollars a Year, $10 at a Time” by Molly O’Toole.

• “Gang Rule: An Experiment in Countering Criminal Governance” by Christopher Blattman, Gustavo Duncan, Benjamin Lessing, and Santiago Tobon.

• “Gangs of Medellín: How Organized Crime is Organized” by Christopher Blattman, Gustavo Duncan, Benjamin Lessing, and Santiago Tobon. (Draft not yet available).

• “The Costs of Crime and Violence: New Evidence and Insights in Latin America and the Caribbean” edited by Laura Jaitman.

Transcript of this episode:

 

Jennifer [00:00:06] Hello and welcome to Probable Causation, a show about law, economics, and crime. I'm your host, Jennifer Doleac of Texas A&M University, where I'm an Economics Professor and the Director of the Justice Tech Lab.

 

Jennifer [00:00:17] My guest this week is Mica Sviatschi. Mica is an Assistant Professor of Economics at Princeton University. Mica, welcome to the show.

 

Mica [00:00:24] Thank you so much, Jen, for having me. This is actually an amazing opportunity to talk about research on crime.

 

Jennifer [00:00:30] Well, I'm very happy to have you here. Today, we're gonna talk about your work on the economic effects of criminal gangs in El Salvador. So could you kick things off for us by telling us about your research expertise and how you became interested in this topic?

 

Mica [00:00:45] Yes, sure. So most of my research studies, actually, how criminal organizations such as gangs and drug trafficking groups in developing countries in particular, how these criminal organizations affect cultural behavior such as human capital investments and also how they affect state presence in the areas they control. I also work with governments to design and evaluate public policies affecting drug trafficking and gang-controlled areas. And for this, I make use of large administrative datasets. So today I will be mainly talking about this research related to organized crime, which is coauthored by Nikita Melnikov at Princeton University and Carlos Schmidt-Padilla from Berkeley University.

 

Mica [00:01:23] So how I became interested in these topics is actually because in recent decades, criminal organizations have become a major threat for international security and for global economic development. And although everything has been good, we know that general crime has declined a lot in recent decades, it has increased a lot in urban centers in the developing world. In particular, what we have seen is that it has increased a lot in Latin America, which contains 43 of the 50 most murderous cities in the world. So the first question I became interested in is what has been causing all this violence? And well, much of this violence I found has been attributed to criminal organizations such as drug cartels and gangs. And here's something important. When I'm talking about gangs, I do not mean small street gangs, but actually large, powerful organizations that have complete control of certain neighborhoods and sometimes even cities in developing countries. In the particular case of El Salvador, which I'm going to talk about today, there is anecdotal evidence that suggests that up to 50 percent of the population live in territories controlled by gangs. And given the setting, this is why I may I became interested in this topic.

 

Jennifer [00:02:31] Yeah, the situation in El Salvador, as I was reading this paper, just was fascinating, and it's just amazing how little I knew about this context. So give us a little bit more background on what's happening in El Salvador. What are the major gangs that are there and where are they most influential?

 

Mica [00:02:48] Yes. So the main gangs in El Salvador are actually the ones that appear today in the newspaper a lot, which are the MS-13 and Barrio 18. And it's important to note that actually both of these gangs were formed in the 1980s in Los Angeles by young immigrants from Central America that came to the U.S. fleeing civil war in their countries of origin. And back in the day, the Salvadorans were living in very tough neighborhoods, where actually other gangs already exist. And what this story says is that for self-defense reasons, some of the Salvadorans decided to create this gang, which is MS-13 today, and some others joined the Barrio 18. Which actually the main business of these gangs was extorting and drug selling the streets of L.A. And then there was a change in deportation policy in the U.S. which sent these criminal deportees back to their countries of origin, in this case, back to El Salvador.

 

Mica [00:03:40] So today, both of these gangs — which are the MS-13 and Barrio 18 — together in El Salvador, they have approximately 70,000 members. And it's estimated that nearly half a million people, which are relatives, business partners, politicians and police are actually financially dependent on them. And if you think about it, these are very large numbers, given that the population of El Salvador is only 6 million. So this is a lot. We're talking about half a million. And moreover, these gangs not only have presence in El Salvador, but also in other countries, such as Honduras, Guatemala, Mexico, Italy and also the U.S.

 

Mica [00:04:16] In general in terms of how these gangs work these gangs are powerful and mainly they use their power to extract money from the local population, often via extortion and drug selling, the same things that they were doing in L.A. back in the 1980s. That's what they do now in Central America. And something very important for this study is that in order to make sure that individuals do not migrate out from these gang controlled areas and to avoid extortion, these gangs are also known to restrict the mobility of individuals living under that territory. And finally, another important fact is that these are the gangs that are potentially responsible for the recent increase in Central American refugees into the United States today.

 

Jennifer [00:04:56] Yeah. And so, as you mentioned, the interaction between the U.S. and El Salvador does go back to this previous U.S. policy that you're gonna make use of here that led to an increase in gang activity in El Salvador. So walk us through that policy change. What happened? What was the policy change and how did it affect gang activity there?

 

Mica [00:05:14] Yes. So in this paper, basically what we did was to take advantage of the natural experiment that took place in El Salvador. So basically in the early 1990s, El Salvador did not have any powerful gangs. However, in 1996, the United States, they changed this immigration policy, making basically easier to deport individuals with some criminal records to their home country. And as a result, in 1997, many Salvadoran migrants who were members of gangs in the United States were deported back to El Salvador, where they reestablished those gangs immediately. Importantly, when they went back to El Salvador, they gained their freedom. And something very important is that by 1997, El Salvador was still recovering from the civil war in the 1980s that ended in 1992. For instance, in many places in El Salvador the police simply did not exist. And as a result, the gangs were able to quickly expand their influence and become powerful organizations that we see today.

 

Jennifer [00:06:11] Do you have a sense of how similar the experience of gang activity in El Salvador is to that in other developing countries?

 

Mica [00:06:19] Yes. Actually, the same events of deportations took place in Guatemala and Honduras where we today we see the same gangs, the MS-13, and the Barrio 18 present, controlling also the different neighborhoods. They have complete control over the neighborhoods. They are territorial, but more generally gangs similar to MS-13 and Barrio 18 are also present in other developing countries like in Colombia, Brazil, Jamaica, South Africa. And the activity that they do is also pretty similar. The main sources of revenue are extortion and drug selling. And as I was saying before, most of these gangs are characterized for being highly territorial and maintain their control over their certain areas, often restricting this individual mobility, to avoid informants entering into their territory and also to be able to do their activities, which are extortion and drug selling.

 

Jennifer [00:07:05] OK so the results of the study are going to be highly relevant to all of those other places it sounds like. OK, so your paper is titled "Gangs, Labor Mobility, and Development." And as you said, it's coauthored with Nikita Melnikov and Carlos Schmidt-Padilla. So give us a sense of what the existing literature looked like before you started working on this paper. Before your paper, what had we known about the effects of gangs in El Salvador and elsewhere?

 

Mica [00:07:30] Yes. So most of the evidence was descriptive. I highlighted the high cost of gangs in terms of violence. On this we knew a lot also about the criminal careers, but we knew very little about what happens once gangs have complete control of territory. Once we don't have this violence of gangs contesting by them for territory. And on this a related paper, actually from Chris Blattman, Gustavo Duncan, Ben Lessing, and Santiago Tobon describes actually how gangs are organized and managed in Colombia. It's actually fascinating work because it describes under which circumstances gangs may choose to govern and the type of services they offer in these territories they control. Basically, our paper complements this new literature by estimating causally the effect of living under the rule of gangs on development and state capacity and also how these restrictions to mobility imposed by gangs may affect household outcomes.

 

Jennifer [00:08:24] And since we hadn't had a paper before, it sounds like, that was able to estimate those causal effects, it's obviously hard to do. So talk us through the main empirical challenges you had to overcome to do this study. Is the hard part finding the data or the natural experiment or is it both?

 

Mica [00:08:42] I would say it's both. So let me tell you a bit about the chance of estimating the effects of gangs on economic development. And the fact is that in most settings, the emergence of gangs or criminal organization in certain locations is endogenous to historical socioeconomic characteristics such as, for instance, poverty, pre-existing violence. So in the case of El Salvador and the gangs, the fact that gangs emerge as a result of this plausible exogenous change in U.S. deportation provides a unique experiment that allows us to estimate the causal effects of gangs presence. And then the second thing is data. That in general is not- there is not much knowledge about where the gangs are located. And here we exploit that we could have access to police intelligence data on the exact boundaries of these gangs' locations.

 

Jennifer [00:09:30] And yes, your main analysis uses those boundaries of these gang controlled neighborhoods in San Salvador, the capital of El Salvador, as a natural experiment, comparing people who live just inside the gang territory with those who live just outside, which is a beautiful natural experiment. So tell us about how those boundaries came to be and why they are useful for measuring the effects of gangs.

 

Mica [00:09:54] Yes. Initially, basically, when the gang leaders were deported to El Salvador in 1997, the country as I was saying before was still recovering from the consequences of the civil war that ended in 1992. For instance, in certain areas, the police literally did not exist. So in certain way, the gangs filled that vacuum. So in the next few years, the gang activity expanded, recruiting new members and expanding the boundaries of their territory. However, at the same time that this happened, of course, the police also expanded ability to fight the gangs and to prevent them from expanding their influence. And ultimately, the boundaries were formed as a result of these two forces. Therefore, the location, the exact location that we see of the boundaries is as good as random. Basically they would have been, you know, shifted by 50-100 meters in either direction. So in terms of our edification strategy, a spatial regression discontinuity design, we compared development outcomes in areas just 50 meters away from each other. And in addition, we have data in ---- in 1992, which was five years before the deportation of gang leaders from the U.S. And we can see that those locations had similar levels of development.

 

Jennifer [00:11:06] So tell us a little bit more about what this looks like in practice. You talk a bunch in the paper about how you have like clear entry and exit points and you need permission to enter, you have to pay. So just talk us through like what is the experience for people who live inside and people who live outside and to what extent people can come and go.

 

Mica [00:11:24] So basically and this is actually the fact that all these other restrictions on mobility is one of the mechanisms that we have in mind. And this came actually by doing- so, when we started this project, we thought about many mechanisms, knowing that gangs would affect economic development. And we were open minded about this. So we went to ---- and actually we talked to many people and this story was consistently was the following, was this about the mobility. So basically gangs want to maintain their control over individuals leaving the area because if this individual would leave, then we have less rent from extortion, which is their main source of income. Also, at the same time, they want to protect themselves from police informants, infiltrators from the rival gangs. Therefore, for these two reasons, the gangs make it difficult for individuals to cross the boundaries of their territory in any direction whether you want to enter or you want to leave.

 

Mica [00:12:14] So, for example, for you to come in the area, individuals need to have permission from the gang leader. In addition, if they got that permission, they have to pay a fee equally, more or less approximately one dollar every time they want to cross the border. And thus it is very difficult for people living in gang controlled areas to basically choose to work in areas outside of the boundaries. It's very high- it's very costly for them to leave this gang territory. And as a result, they have to work in the neighborhood where they live, which often ends up in small firms and low paying jobs. So basically we argue that these limits on individual economic mobility can potentially play an important role in reducing economic development in gang controlled areas.

 

Jennifer [00:12:55] And so that reduction in mobility is definitely one potential mechanism here, as you mentioned. What are the other mechanisms we might have in mind for why living in one of these neighborhoods could affect the economic outcomes of the people living there and maybe economic development in these areas more broadly?

 

Mica [00:13:11] So basically there are several mechanisms and actually to do this, we could- well, I would tell you that I used this data from the police. Then I also use the census demographic in 1992 and 2007, which basically have this geocoded census tract. But they didn't have that many questions related to the mechanisms. So for these, we basically went to these gang controlled areas and we did this geocoded survey to 3,000 households where we asked several questions related to three mechanisms. The first one is really about violence. No? First, you may think that all these effects in economic development, the negative effects that we find are driven by increasing violence. But actually we find that this is not the case. As I was telling you before, these are territories that have been controlled by one particular gang for decades. So we explored in territories where one gang has the monopoly and violence is not the main driver.

 

Mica [00:14:03] Then the second thing that I wanted to know is how much the effects are driven by lower quantity or quality of public investment. It is possible that now, since the gang control hysteria, the government don't go there. They don't invest in schools, in health centers. There is no public investment. And basically what we find in this case is that interestingly, we don't find that the effects are driven by a lower quality or quantity of public goods. So this is not the case. We did not find any differential effects in gang areas on the quantity and quality of public goods relative to non-gang areas. And basically here what we argue that can be happening is that possibly gangs allow some level of infrastructure to be built by the government so they can extract more from their population. So we have this mix of a state and gang presence.

 

Mica [00:14:50] And the third thing is that there was this common belief that criminal organizations may provide their own public goods, not that this state is not able to provide. And basically, we don't find that much evidence that this is the case. We find that gangs do not seem to be providing, you know, their own public goods. We don't find evidence that individuals resort to the gang leader to solve their domestic disputes, neither public goods ----. So basically what we do find is that gangs limit the mobility of individuals. And by limiting this mobility, gangs restrict their residents' labor choices. And we actually find a lot of evidence that individuals living in these gang controlled areas are less likely to work far away from the gang neighborhoods. And this can be a potential reason for explaining this lower income of individuals living under gang control.

 

Jennifer [00:15:39] So as you're alluding to here, you have a bunch of different outcomes that you were able to look at and you mentioned this cool survey that you do. So just let's talk more about the data more broadly. What what are the data sets that you have at your disposal? And how did you manage to obtain those data?

 

Mica [00:15:53] Yes. So the data mainly comes from three sources. So the first one is that we got data from the police on the exact location of the boundaries of gang territory in the capital of El Salvador, San Salvador. Basically this data allow us to perform the spatial regression discontinuity design using the distance to a boundary of gang territory at the ---- boundary. Second, to consider the effect of gang presence on economic development, we need data that is almost like geocoding. So for this, we got access to data from the 1992 and 2007 waves of the census. This is perfect because 1992 allows us to test the pre-existing characteristics before the arrival of criminal deportees from the U.S. In 2007 we can analyze the effects on a diverse range of outcomes at the household level. And as I was saying, the status of ---- at the census tract level, which is partially geocoded, each census tract consists of approximately 300 households. And finally, the third dataset that we use is that to try to understand the mechanisms on economic development, we actually went to these gang controlled areas and we conducted this geocoded survey to these 3,000 households where we ask individuals questions about mobility, where do they work, occupation, also the public goods, a provision and quality in their neighborhoods, also to which extent they resort to gang leaders to solve their conflict and other potential mechanisms.

 

Jennifer [00:17:16] So the fact that you guys did a survey was just amazing. And so you didn't do the survey yourself, you had a survey firm, right? So how did - so was it difficult to find a firm that was able to go into these areas? What were - I mean it sounds like there were restrictions on what they could ask. Tell us more about the logistics of all of that.

 

Mica [00:17:34] Yes, definitely. Yes. Actually, so, this firm is known to do you know, they work doing the census. So it was useful for us. But the thing is, the most complicated thing when you enter these locations is whether if you start asking questions related to gang businesses. But since we were doing a lot of question related to socioeconomic conditions, labor outcomes, in those cases, we don't have a problem. But in general, what this strategy that we did was basically to try to go in areas where we wouldn't bother, you know, the gang leader or they would check our questionnaire. So to try to avoid that. But in terms of the questionnaire, most of the questions households were willing to answer. The only one that was a bit more complicated was when we asked them about whether gangs restrict - well we asked directly basically, if gangs restrict their mobility in the neighborhood. And that was the more most problematic question, but all the rest were OK. So that was the only condition when we were working with this firm surveys companies, whether like which things we could ask and they said you can ask anything as long as it's not related to the main business of the gangs, which is the drug selling and extortion.

 

Jennifer [00:18:40] Interesting. OK, so what are your main findings on the effects of living in gang controlled neighborhoods on economic outcomes?

 

Mica [00:18:48] So the results from this spatial regression discontinuity, basically, we find that individuals living under these neighborhoods that are under the control of gangs have become significantly poorer than individuals leaving only 50 meters away in locations that are not controlled by gangs. I think that this is super interesting- it's just 50 meters away. And these are very large effects. We see that individuals living under the rule of gangs have more or less 50 percent lower income than individuals that are just outside the boundaries. Moreover, they have much less years of education and worse housing conditions, lower probability of having durables and also quality of their dwelling is much worse. And what it is more, we actually validate these results that we got from survey data and reported data using a difference-in-differences strategy where we see that also in these locations where we have a gang presence that is lower growth in luminosity. And while you might think that these areas were worse areas to begin with we find that this is not the case, given that none of these differences or these continuities existed in 1992 before the arrival of gangs from the U.S.

 

Jennifer [00:19:57] And we already talked a little bit about mechanisms. So you do test a bit to see to what extent all this is driven by say, differential access to public schools or different economic incentives to work. So if you have- you know, the gangs are now taxing your income heavily, maybe you just don't invest in your human capital and don't bother finding a better paying job and all that. So, yes, so talk more about what you do there to test the potential mechanisms and what you find.

 

Mica [00:20:22] So basically like to rule out the effects on violence. What we do is that we got this homicide data and in general, what they said, for instance, for the first mechanisms, that this is the one of the increasing violence, what we do is basically restricting our analysis, taking out places that can be contested. So those census tract that are close to the boundaries and we find that the effects mostly hold and they don't change at all in even in magnitudes. Then to see these of the effects of quality and quantity of public goods, we basically ask individuals that live in these areas how they qualify these public goods: their schools, equality, the health centers, the roads. And mostly notice there are no differences between individuals that live in these locations and the individuals that do not live there. Also, we use- I mean, data that has like the geocoded location of schools and hospitals and we don't find any difference right across the boundaries.

 

Mica [00:21:19] Then to analyze this of the gang mobility, basically, we- oh I'm sorry, affect gangs' mobility- individuals' mobility, we ask questions related of where individuals work and not only about their job's location, but also whether, for instance, they go to the beach and the beach actually is like 30 minutes from the place where they are. Like Salvador is very small. So you can go to a beach in 30 minutes. And we also find effects that individuals not only are less likely to work far away, but also they are less likely to move even out, to go, you know, to the beach or next to it to the apartment that is next to San Salvador. So there are a lot of pieces of evidence that show that individuals are highly affected by these limitations in mobility. And moreover when we ask this question about how much they think that freedom of movement is a problem in their neighborhood, we find it seems a larger share of individuals that live under a gang controlled neighborhood saying that this is the case.

 

Jennifer [00:22:20] OK. And then as you mentioned, you you also do this analysis with luminosity so you have these really cool data from satellites on the light levels across the whole country. And so you use a difference-in-difference design to measure how economic development changes in places with increased gang presence after the U.S. started deporting gang members. So this was really neat. So tell us more about this part of the paper. What do these luminosity data tell us exactly and how do you use this measure to test for a causal effect of gangs?

 

Mica [00:22:54] Yes. So basically we use this nighttime light density, which is our main outcomes for the difference-in-differences analysis, which is increasingly used as a proxy for economic activity at the level for which economic standard statistics such as such as GDP per capita, industrial production are not available in El Salvador. And importantly, this data is available for all the years. So for every year from 1992 to 2013, we have these data at the ---- level. So this allows us to see a timing when the area is exposed to gang presence, they start experiencing lower rates of economic growth which would coincide with the regression discontinuity design because it was a cross section just before and after. So the later, this, basically what we do is compare luminosity growth in areas that were exposed to gang activity and this is proxy by the presence of homicides that the police the police classify as committed by gangs and areas that were not. And they later basically say values counterfactual for the former if prior to the emergence of gangs in 1997, the two groups experienced similar growth in luminosity, basically the parallel trends assumption. We test this and we see that this is confirmed. In addition, to further address the concern that maybe there is some endogeneity of the locations with a gang presence, we basically used the ---- location of the known gang leaders, as an instrument from whether this location was exposed to these U.S. gangs or not.

 

Jennifer [00:24:19] So you now have these kind of two sets of analyses that show that it's not some sort of preexisting condition that like the gangs picked the places that were already worse off in some way, that like it really did seem like these places were, you know, just on the other either side of the boundary. And then just more broadly, using your diff-in-diff, like they were all developing exactly the same way before. And then suddenly the U.S. changes its policy and starts deporting these gang members to the country and things suddenly get worse in these places that the gangs take over. Yeah. So having having both the spatial discontinuity design plus this diff-in-diff with light, which I just found very compelling side by side. So let's talk about policy implications then. So I'm sure people are listening and thinking, well, this is evidence that the U.S. was right to deport these gang members. Clearly, they were dangerous. Right? But as I was reading it, I was thinking, well, you know, the amount of trouble they might cause in El Salvador might be different from the amount of trouble they can cause in the U.S. So it might be, you know, if we're thinking about kind of the broader social welfare, it might have been better to keep them in the U.S. How do you think about the potential tradeoffs here? You've thought about this for a lot longer than I have. So what in your mind, what do your results say about optimal immigration policy?

 

Mica [00:25:35] So, yes, basically the statement that the U.S. was right to deport these gang members, I actually should be viewed with caution. While the deportation of gang members may have initially slightly reduced the level of crime in the U.S., it may have done more bad than good not only for El Salvador, but also for the U.S. Importantly, when the gang members were deported to El Salvador, the local government did not have the capacity to prevent the gangs from expanding and becoming these powerful criminal organizations that exist today. In 1997, El Salvador was still recovering from the civil war in 1992. There was no large police form. For instance, the rural police unit was only created in the very early 2000s. So it was easy for the gangs to recruit poor individuals in El Salvador who were living in poverty and did not have good job prospects. All these features, also characteristics of many developing countries, basically empowered gangs and allowed them to grow, something that would not have happened in the U.S. In turn, now that the gangs are powerful, thousands of individuals you see that are fleeing from El Salvador to the United States creating a humanitarian crisis, a significant increase in the costs of law enforcement. Moreover, another disadvantage to the U.S. that I haven't mentioned, is the fact that many of these gangs are also used by the Mexican cartel for drug traffic into the U.S. Therefore, I think it is quite likely that it would have been much cheaper for the U.S. not to deport the gang members, but to allocate more funds to social welfare programs and law enforcement to prevent organized crime from taking place in the U.S. in the first place.

 

Jennifer [00:27:10] And is your sense that just as you said, the police capacity in El Salvador has increased over time, if the same change in U.S. policy had happened like 10 years later, in your mind, do you think that the effects would have been similar or would it have been a very different story?

 

Mica [00:27:26] Like if in the U.S. they would have like the similar conditions and not having this happen?

 

Jennifer [00:27:30]  Yeah, if this happened in 2007 instead of 1997, would El Salvador have been in a better position to sort of prevent the gangs from taking hold or?

 

Mica [00:27:38] I think that yes, because they would have had a better sense, you know? They would have better records. By the time when these new deportees were arriving, they were not even having the correct records. And something important is that they were gaining their freedom once they were back in El Salvador. Something that today like, for instance, if you deport criminal members from the U.S., that is- toward these countries, they have a better system, they cannot go to jail, but they have a system of tracking these individuals where they go. There is a stronger police force. It still is not great, the best, because it is a developing country, but it's much better than in 1997.

 

Jennifer [00:28:15] Yeah, that's really interesting. So, I mean, taking U.S. immigration policy out of this, I guess, what are the policy implications for El Salvador and for other developing countries that are currently dealing with gangs like this? What do these new results from this paper mean for them?

 

Mica [00:28:31] So as I was saying before, this MS-13 and Barrio 18 and also similar criminal organizations are active in many developing countries. So I think that this paper highlights the huge cost of gang activity to economic development and the potential benefits from fighting organized crime. Moreover, often violence is considered the main, if not only social cost of criminal organization, sometimes suggesting that less gang competition can be well for improvement. And basically in this paper, we highlight a potential huge cost of territory controlled by criminal organizations moderating kind of those claims. And the other contribution of the study documents and new mechanisms restricting economic growth in the presence of organized crime by restrictions of individual mobility. And this mechanism highlights the importance of freedom of movement for development policy, in terms of restrictions on individuals' mobility existing in multiple settings not only in the presence of gangs.

 

Jennifer [00:29:25] And I know, I know you have some other work on gangs and gang activity and so I do want to talk about the research frontier, but also want to give you a chance to talk about that other work. So what else do we know and what are the big questions that you and others interested in this topic will be thinking about going forward?

 

Mica [00:29:42] So what we are trying to work a lot is mainly about more and more because there is little work detailing the causes and consequences of organized crime, especially in developing countries. For instance, another work that we are doing also with ---- is basically trying to understand how incarceration policies may have affected expansion of gangs into new neighborhoods also in Central America. Also, for instance, Santiago Tobon, Chris Blattman, Ben Lessing, and Gustavo Duncan are doing great work studying the organization and hierarchies of gangs as well as this interplay of gangs and the state in Medellín. Also Ben Lessing is doing working in Brazil, studying how gangs and cartels coordinate their activities from jail. And also in this line, I think that more work is needed to understand what policies can mediate the negative effects of gangs, cartels and other non-state actors.

 

Mica [00:30:32] And in this line, there is a very interesting paper that is new from Beatriz Magaloni and coauthors, which basically in Brazil they study, they show how community policing may have differential effects based on whether criminal groups cooperate with a community. That is, whether the criminal organization provides some sort of social order order in these communities by sanctioning small local criminals. And what they find that under these circumstances, in these locations where there is some cooperation with a community of these gangs and cartels, if you do a policy of a state crackdown, this may undermine the criminal governments that is often critical to keep violent criminals at bay and might increase criminal activity throughout the community. And in this way, I think that research on such policies and the relationship between gangs, the community they control, and the state may be an unexplained avenue for future research, which we are also trying to explore.

 

Jennifer [00:31:24] Yeah, unintended consequences feel like a real, real potential problem here. And I agree that the you know, it's it's always helpful to document the causal effects as you've done in this paper. And then the next question is always, well, what do we do about it? In your- so, you mentioned, you know, work that's ongoing in a bunch of different countries across Latin America. So first of all, it's just been really interesting to see this explosion of new work outside of the United States and outside of Europe on crime. Since it's a relatively new development. And so it's been fun to see all the new papers in this area. Do you have a sense of kind of how much policy experimentation there currently is across different governments in terms of, you know, trying new ways of dealing with the challenge of gangs?

 

Mica [00:32:09] Yes, I think for instance, in the case of El Salvador certain units, for instance, the Ministry of Security, which was the one that shared data with us, they are willing, you know, not as much maybe to do a randomized controlled experiment, but also, you know, to show they've done work together about, which ---- for instance, which is the optimal location of when you were incarcerating individuals in which jails to put them. Should you separate the jails based on gang membership or not? Those are things that they are willing to do in the case, for instance, of Peru and Colombia, I think that in government is also willing to do, you know, work joined with a researchers. And I know, for instance, that the same group that is working, enmeshing of Santiago Tobon, Chris Blattman, Ben Lessing, and Gustavo Duncan, and they are doing some interventions of randomized controlled trials, joined with Bogota, Colombia to try to understand which are the best policies, you know, to mitigate the negative consequences that these gangs may have in their communities.

 

Jennifer [00:33:10] It's so interesting.

 

Mica [00:33:11] So isn't this uh, I think that Latin-America in this way, since it is still developing country but it's organized and it's it's more developed than other places probably in in Africa, or in other locations. This gives you also opportunity to also be working, you know, with the government.

 

Jennifer [00:33:29] Mhmm, and it does seem like the data has gotten better from Latin America over time, too. Is that your sense also?

 

Mica [00:33:35] Yes.

 

Jennifer [00:33:36] That's great. That's very important. Being able to get access to administrative crime data. Oh, well, fantastic. My guest today has been Mica Sviatschi from Princeton University. Mica, thanks so much for doing this.

 

Mica [00:33:47] No, thank you so much for inviting me.

 

Jennifer [00:33:54] You can find links to all the research we discussed today on our website, probablecausation.com. You can also subscribe to the show there or wherever you get your podcasts to make sure you don't miss a single episode. Big thanks to Emergent Ventures for supporting the show. And thanks also to our Patreon subscribers. This show is listener supported, so if you enjoy the podcast, then please consider contributing via Patreon. You can find a link on our website. Our sound engineer is Caroline Hockenbury with production assistance from Elizabeth Pancotti. Our music is by Werner, and our logo is designed by Carrie Throckmorton. Thanks for listening and I'll talk to you in two weeks.