The Cartel Wars: Fighting Over Opioid Crisis Profits
Fernanda Sobrino (Economics, Princeton)

The number of major drug trafficking organizations in Mexico increased from four to nine over the last two decades. This was accompanied by an increase in drug trade related violence. This paper examines the relationship between competition and violence in illegal drug markets. In particular Fernanda Sobrino exploits an external demand shock to the heroin market, the 2010 OxyContin reformulation. She constructs a novel data set of cartel presence across municipalities by scraping Google News and using natural language processing. She exploits within municipality variation from combining agro-climatic conditions to grow opium poppy with heroin prices in the United States across time. Event study estimates suggest that cartel presence increases substantially after 2010 in municipalities well suited to grow opium poppy. Homicide rates increase in the number of active cartels per municipality, with the higher increases when a second, third and fourth cartel become active in the territory.These results suggest that some of the increase in violence that Mexico experienced in the last fifteen years could be attributed to criminal groups fighting for market shares of heroin.

Fernanda Sobrino is a Ph.D. candidate in the Department of Economics, and has received her B.A. in Econonomics and Applied Math from the Instituto Tecnológico Autónomo de México (ITAM). Her research interests include development economics and industrial organization. Currently, Fernanda is focusing on the organization and networking of criminal activities and how illegal markets work and interact with legal ones.

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The Executive Dilemma: Bargaining for Education in Decentralized Brazil

Galileu Kim (Politics, Princeton)

Why do politicians engage in patronage? What are its consequences for public service delivery? I find that staff turnover in educational staff results from mayors attempt to exchange public sector jobs for support from local legislators. Leveraging extensive fieldwork and administrative data, I demonstrate that mayors with a weaker hold on the local legislature resort to patronage to co-opt legislators. Educational staff turnover has negative downstream effects on student learning, but limited electoral backlash. Weak electoral accountability channels suggests that patronage is primarily a political elite game, with little participation by local constituencies. These findings point to the dangers of elite capture of public services and its downstream consequences for social welfare.

Galileu Kim is a Ph.D. candidate in the Politics Department. His research agenda explores the political economy of local state capacity and the management of  bureaucracies as a political strategy. His dissertation combines evidence from fieldwork interviews and administrative data on municipalities in Brazil, analyzing the impact of bureaucratic turnover in educational attainment. Galileu holds a B.A. in political science and economics from the University of Pennsylvania.

This event is free and open to the public. Lunch will be served.