Pub Date : 2026-01-23DOI: 10.1016/j.jdeveco.2026.103731
Runhao Zhao, Ye Yuan
Firms strategically locate and time their emissions to evade environmental regulations. We uncover a novel form of temporal evasion: firms discharge wastewater into waterways during periods of heavy rains. By employing a difference-in-differences approach and analyzing high-frequency water quality monitoring and rainfall data, we find that water pollution concentrations rise more significantly in catchment areas densely populated by polluting firms relative to low-density areas. Our empirical findings align with a stylized model that predicts polluters exploit the dilution effects of rainfall to strategically increase wastewater discharge under a threshold-based monitoring system. We estimate that this covert “polluting-in-the-rain” behavior can offset 43% of China’s annual emission reduction targets.
{"title":"Strategic emissions in the rain","authors":"Runhao Zhao, Ye Yuan","doi":"10.1016/j.jdeveco.2026.103731","DOIUrl":"10.1016/j.jdeveco.2026.103731","url":null,"abstract":"<div><div>Firms strategically locate and time their emissions to evade environmental regulations. We uncover a novel form of temporal evasion: firms discharge wastewater into waterways during periods of heavy rains. By employing a difference-in-differences approach and analyzing high-frequency water quality monitoring and rainfall data, we find that water pollution concentrations rise more significantly in catchment areas densely populated by polluting firms relative to low-density areas. Our empirical findings align with a stylized model that predicts polluters exploit the dilution effects of rainfall to strategically increase wastewater discharge under a threshold-based monitoring system. We estimate that this covert “polluting-in-the-rain” behavior can offset 43% of China’s annual emission reduction targets.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"181 ","pages":"Article 103731"},"PeriodicalIF":4.6,"publicationDate":"2026-01-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146039648","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-20DOI: 10.1016/j.jdeveco.2026.103720
Loren Brandt , Johannes Van Biesebroeck , Luhang Wang , Yifan Zhang
China’s manufacturing sector has been a key source of the economy’s dynamism. Analysis after 2007 however is hampered by problems in the key data source for empirical analysis, the National Bureau of Statistics’ (NBS) annual survey of industrial firms. Issues include missing information on value added and intermediate inputs, and concerns of over-reporting. The annual survey of firms conducted by China’s State Taxation Administration (STA) provides a reliable, alternative source of firm-level data for the years 2007 to 2013. Since the sample is not representative and the precise sampling scheme is not known, the data cannot be used directly to draw inferences on China’s manufacturing sector. By comparing the joint distribution of key variables for which both surveys provide reasonably reliable information, we recover the sampling scheme of the STA survey and use it to simulate samples for 2007 to 2013 that are comparable to the NBS sample in earlier years. Our estimates reveal a marked slowdown in revenue-based total factor productivity growth that cuts across all industries, ownership types, and regions. The loss of dynamism in the private sector, and the reduced contribution of firm entry to aggregate productivity growth are especially prominent.
{"title":"Where has all the dynamism gone? Productivity growth in China’s manufacturing sector, 1998–2013","authors":"Loren Brandt , Johannes Van Biesebroeck , Luhang Wang , Yifan Zhang","doi":"10.1016/j.jdeveco.2026.103720","DOIUrl":"10.1016/j.jdeveco.2026.103720","url":null,"abstract":"<div><div>China’s manufacturing sector has been a key source of the economy’s dynamism. Analysis after 2007 however is hampered by problems in the key data source for empirical analysis, the National Bureau of Statistics’ (NBS) annual survey of industrial firms. Issues include missing information on value added and intermediate inputs, and concerns of over-reporting. The annual survey of firms conducted by China’s State Taxation Administration (STA) provides a reliable, alternative source of firm-level data for the years 2007 to 2013. Since the sample is not representative and the precise sampling scheme is not known, the data cannot be used directly to draw inferences on China’s manufacturing sector. By comparing the joint distribution of key variables for which both surveys provide reasonably reliable information, we recover the sampling scheme of the STA survey and use it to simulate samples for 2007 to 2013 that are comparable to the NBS sample in earlier years. Our estimates reveal a marked slowdown in revenue-based total factor productivity growth that cuts across all industries, ownership types, and regions. The loss of dynamism in the private sector, and the reduced contribution of firm entry to aggregate productivity growth are especially prominent.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"181 ","pages":"Article 103720"},"PeriodicalIF":4.6,"publicationDate":"2026-01-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146039649","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-19DOI: 10.1016/j.jdeveco.2026.103726
Marion Richard , Oliver Vanden Eynde
The effectiveness of security operations often depends on cooperation between national armies. Such cooperation can be particularly important when international borders are porous and armed groups can operate across borders. We investigate how the creation of an international armed force that could operate across international borders (the G5-Sahel Joint Force) together with improved communication between national armies affected conflict dynamics in the Sahel region. Relying on a regression discontinuity design, we find that the G5 mission lowered the intensity of conflict locally in its zone of operation, especially along border segments more porous due to their geographical features or ethnic composition. Further analysis of geographical conflict propagation patterns indicates that the G5-Sahel force facilitated security operations in border areas.
{"title":"Cooperation between national armies: Evidence from the Sahel borders","authors":"Marion Richard , Oliver Vanden Eynde","doi":"10.1016/j.jdeveco.2026.103726","DOIUrl":"10.1016/j.jdeveco.2026.103726","url":null,"abstract":"<div><div>The effectiveness of security operations often depends on cooperation between national armies. Such cooperation can be particularly important when international borders are porous and armed groups can operate across borders. We investigate how the creation of an international armed force that could operate across international borders (the G5-Sahel Joint Force) together with improved communication between national armies affected conflict dynamics in the Sahel region. Relying on a regression discontinuity design, we find that the G5 mission lowered the intensity of conflict locally in its zone of operation, especially along border segments more porous due to their geographical features or ethnic composition. Further analysis of geographical conflict propagation patterns indicates that the G5-Sahel force facilitated security operations in border areas.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"181 ","pages":"Article 103726"},"PeriodicalIF":4.6,"publicationDate":"2026-01-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146039646","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-17DOI: 10.1016/j.jdeveco.2026.103724
Melissa Hidrobo , Harold Alderman , Negussie Deyessa , Daniel O. Gilligan , Parthu Kalva , Jessica Leight , Michael Mulford , Heleene Tambet
The prevalence of depression remains high in low-income contexts, particularly those affected by conflict. This paper reports on a randomized controlled trial conducted in rural Ethiopia assessing the effects of a psychological (group therapy) intervention delivered by non-specialist health staff, as well as a large one-time cash transfer delivered post-therapy. The trial includes three arms comparing group therapy, cash, and both jointly to a status quo control within a sample of individuals reporting some depressive symptoms or functional impairment at baseline. The study occurred between 2022 and 2024, during a period of active armed conflict. Findings show that sixteen months post-baseline, there are no persistent positive effects of group therapy alone; cash alone improves time use and economic outcomes. Group therapy and cash jointly improve psychosocial skills, time use, and economic outcomes, and in areas not affected by conflict, the joint intervention also improves mental health.
{"title":"The effects of cash and group therapy in the context of conflict: Evidence from a randomized evaluation in Ethiopia","authors":"Melissa Hidrobo , Harold Alderman , Negussie Deyessa , Daniel O. Gilligan , Parthu Kalva , Jessica Leight , Michael Mulford , Heleene Tambet","doi":"10.1016/j.jdeveco.2026.103724","DOIUrl":"10.1016/j.jdeveco.2026.103724","url":null,"abstract":"<div><div>The prevalence of depression remains high in low-income contexts, particularly those affected by conflict. This paper reports on a randomized controlled trial conducted in rural Ethiopia assessing the effects of a psychological (group therapy) intervention delivered by non-specialist health staff, as well as a large one-time cash transfer delivered post-therapy. The trial includes three arms comparing group therapy, cash, and both jointly to a status quo control within a sample of individuals reporting some depressive symptoms or functional impairment at baseline. The study occurred between 2022 and 2024, during a period of active armed conflict. Findings show that sixteen months post-baseline, there are no persistent positive effects of group therapy alone; cash alone improves time use and economic outcomes. Group therapy and cash jointly improve psychosocial skills, time use, and economic outcomes, and in areas not affected by conflict, the joint intervention also improves mental health.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"181 ","pages":"Article 103724"},"PeriodicalIF":4.6,"publicationDate":"2026-01-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146039645","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-17DOI: 10.1016/j.jdeveco.2026.103721
Ruoming Zhang
This study examines how China’s 1999 expansion of university admissions reshaped rural and urban students’ academic high-school choices and, in turn, rural–urban gaps in schooling and employment. Treating the nationwide expansion of tertiary capacity as an exogenous shock, we use microdata from the 2015 1% Population Sample Survey of China to estimate difference-in-differences models with county and cohort fixed effects. Relative to comparable urban cohorts, rural students exposed to the reform were 2.9 percentage points more likely to complete the academic high school track and accumulated an additional 0.26 years of schooling. The expansion also reallocated rural workers away from low-skill employment by 5.1 percentage points. These findings indicate a strong indirect channel operating through upper-secondary choices, while underscoring the need for complementary investments in rural upper-secondary schools and local non-farm labor markets. The evidence is consistent with changes in expectations and application behavior at the upper-secondary transition: national tertiary expansion increased the perceived attainability of the academic track for rural cohorts, inducing adjustments in continuation decisions.
{"title":"Higher education expansion and the rural–urban gap in secondary schooling and labor outcomes: Evidence from China’s 1999 reform","authors":"Ruoming Zhang","doi":"10.1016/j.jdeveco.2026.103721","DOIUrl":"10.1016/j.jdeveco.2026.103721","url":null,"abstract":"<div><div>This study examines how China’s 1999 expansion of university admissions reshaped rural and urban students’ academic high-school choices and, in turn, rural–urban gaps in schooling and employment. Treating the nationwide expansion of tertiary capacity as an exogenous shock, we use microdata from the 2015 1% Population Sample Survey of China to estimate difference-in-differences models with county and cohort fixed effects. Relative to comparable urban cohorts, rural students exposed to the reform were 2.9 percentage points more likely to complete the academic high school track and accumulated an additional 0.26 years of schooling. The expansion also reallocated rural workers away from low-skill employment by 5.1 percentage points. These findings indicate a strong indirect channel operating through upper-secondary choices, while underscoring the need for complementary investments in rural upper-secondary schools and local non-farm labor markets. The evidence is consistent with changes in expectations and application behavior at the upper-secondary transition: national tertiary expansion increased the perceived attainability of the academic track for rural cohorts, inducing adjustments in continuation decisions.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"181 ","pages":"Article 103721"},"PeriodicalIF":4.6,"publicationDate":"2026-01-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145993598","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-17DOI: 10.1016/j.jdeveco.2026.103725
Rafael Parfitt , Nicolas Goulart
This paper examines how extreme heat affects healthcare delivery, using data on around 25 million births in Brazilian public hospitals between 2008 and 2019. Combining satellite-based temperature records with a high-dimensional fixed-effects design, we study how delivery practices and provider allocation vary with short-run temperature fluctuations in maternity wards. We find that extreme heat is associated with a lower probability that deliveries are led by physicians and a corresponding increase in nurse-led births, alongside a decline in cesarean section rates. Among physician-attended deliveries, extremely hot days are associated with a higher likelihood of pre-labor cesarean sections, consistent with shifts toward faster procedures under thermal stress. We find no detectable effects on immediate neonatal health as measured by Apgar scores. Together, these results suggest that temperature shocks reshape clinical decision-making and task allocation in maternity wards, revealing an operational channel through which climate stress affects healthcare delivery.
{"title":"Heatwaves and delivery practices: The effects of extreme temperature in Brazilian maternity wards","authors":"Rafael Parfitt , Nicolas Goulart","doi":"10.1016/j.jdeveco.2026.103725","DOIUrl":"10.1016/j.jdeveco.2026.103725","url":null,"abstract":"<div><div>This paper examines how extreme heat affects healthcare delivery, using data on around 25 million births in Brazilian public hospitals between 2008 and 2019. Combining satellite-based temperature records with a high-dimensional fixed-effects design, we study how delivery practices and provider allocation vary with short-run temperature fluctuations in maternity wards. We find that extreme heat is associated with a lower probability that deliveries are led by physicians and a corresponding increase in nurse-led births, alongside a decline in cesarean section rates. Among physician-attended deliveries, extremely hot days are associated with a higher likelihood of pre-labor cesarean sections, consistent with shifts toward faster procedures under thermal stress. We find no detectable effects on immediate neonatal health as measured by Apgar scores. Together, these results suggest that temperature shocks reshape clinical decision-making and task allocation in maternity wards, revealing an operational channel through which climate stress affects healthcare delivery.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"181 ","pages":"Article 103725"},"PeriodicalIF":4.6,"publicationDate":"2026-01-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146080127","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-12DOI: 10.1016/j.jdeveco.2026.103719
Eduardo Hidalgo , Erik Hornung , Pablo Selaya
We study how NAFTA changed the geography of violence in Mexico. We propose that this open border policy increased trafficking profits of Mexican cartels, resulting in violent competition among them. We test this hypothesis by comparing changes in drug-related homicides after NAFTA’s introduction in 1994 across municipalities with and without drug-trafficking routes. Routes are predicted least cost paths connecting municipalities with a recent history of detected drug trafficking with U.S. land ports of entry. On these routes, homicides increase by 2.1 per 100,000 inhabitants, which is equivalent to 26% of the pre-NAFTA mean. These results cannot be explained by changes in worker’s opportunity costs of using violence resulting from the trade shock.
{"title":"NAFTA and drug-related violence in Mexico","authors":"Eduardo Hidalgo , Erik Hornung , Pablo Selaya","doi":"10.1016/j.jdeveco.2026.103719","DOIUrl":"10.1016/j.jdeveco.2026.103719","url":null,"abstract":"<div><div>We study how NAFTA changed the geography of violence in Mexico. We propose that this open border policy increased trafficking profits of Mexican cartels, resulting in violent competition among them. We test this hypothesis by comparing changes in drug-related homicides after NAFTA’s introduction in 1994 across municipalities with and without drug-trafficking routes. Routes are predicted least cost paths connecting municipalities with a recent history of detected drug trafficking with U.S. land ports of entry. On these routes, homicides increase by 2.1 per 100,000 inhabitants, which is equivalent to 26% of the pre-NAFTA mean. These results cannot be explained by changes in worker’s opportunity costs of using violence resulting from the trade shock.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"181 ","pages":"Article 103719"},"PeriodicalIF":4.6,"publicationDate":"2026-01-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146039647","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-09DOI: 10.1016/j.jdeveco.2025.103716
Charles Irvin S. Siriban
It is well-established that ties between politicians influence the distribution of public resources, particularly in policy domains where officials enjoy substantial discretion. Other policy areas, such as disaster response, have more limited scope for discretionary targeting. To what extent does political alliance influence the allocation of resources in these settings? Focusing on the case of the Philippines, I examine if kinship ties between two major local politicians – provincial governor and congressperson – influence the response to typhoon shocks. Using a close-election regression discontinuity design, I find that kin-connected governors respond better than other governors to strong typhoon shocks. I argue that the effect can be explained by both supply and demand channels. I find suggestive evidence that governors leverage their connections to congresspersons to request more assistance from the national government. Furthermore, voters reward kin-connected governors for their response to strong typhoons. These results provide a lower-bound estimate on the effects of political alliances on the allocation of fiscal resources.
{"title":"Kinship ties in politics and response to extreme weather shocks","authors":"Charles Irvin S. Siriban","doi":"10.1016/j.jdeveco.2025.103716","DOIUrl":"10.1016/j.jdeveco.2025.103716","url":null,"abstract":"<div><div>It is well-established that ties between politicians influence the distribution of public resources, particularly in policy domains where officials enjoy substantial discretion. Other policy areas, such as disaster response, have more limited scope for discretionary targeting. To what extent does political alliance influence the allocation of resources in these settings? Focusing on the case of the Philippines, I examine if kinship ties between two major local politicians – provincial governor and congressperson – influence the response to typhoon shocks. Using a close-election regression discontinuity design, I find that kin-connected governors respond better than other governors to strong typhoon shocks. I argue that the effect can be explained by both supply and demand channels. I find suggestive evidence that governors leverage their connections to congresspersons to request more assistance from the national government. Furthermore, voters reward kin-connected governors for their response to strong typhoons. These results provide a lower-bound estimate on the effects of political alliances on the allocation of fiscal resources.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"180 ","pages":"Article 103716"},"PeriodicalIF":4.6,"publicationDate":"2026-01-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145977310","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-07DOI: 10.1016/j.jdeveco.2025.103714
Matteo Neri-Lainé
This paper studies the effect of insecurity on formal firms’ existence. We develop a flexible theoretical framework in which insecurity, a latent production cost, affects firms’ market entry, exit, and formality decisions. In our empirical analysis, we combine an original dataset on Afghan firms with georeferenced data on military events that we use to proxy insecurity. In the state-building context of post-2003 Afghanistan, military events reflect not only violence but also state capacity expansion. For formal firms, this latter channel dominates. As a result, increased exposure to military events conveys on average a reduction in effective insecurity and positively impacts formal firm existence. Nonetheless, this effect is highly heterogeneous depending on actors, location, timing and firms’ characteristics. The Afghan conflict has the specificity of deeply involving foreign countries. Mobilizing this particular source of exogenous variation, we identify the causal effect of an insecurity reduction on formal firms’ existence. We show that an increase of 1% in the exposure to instrumented military events raises the formal activity probability by 3.8%.
{"title":"Firms under fire! How insecurity affects formal firms’ existence","authors":"Matteo Neri-Lainé","doi":"10.1016/j.jdeveco.2025.103714","DOIUrl":"10.1016/j.jdeveco.2025.103714","url":null,"abstract":"<div><div>This paper studies the effect of insecurity on formal firms’ existence. We develop a flexible theoretical framework in which insecurity, a latent production cost, affects firms’ market entry, exit, and formality decisions. In our empirical analysis, we combine an original dataset on Afghan firms with georeferenced data on military events that we use to proxy insecurity. In the state-building context of post-2003 Afghanistan, military events reflect not only violence but also state capacity expansion. For formal firms, this latter channel dominates. As a result, increased exposure to military events conveys on average a reduction in effective insecurity and positively impacts formal firm existence. Nonetheless, this effect is highly heterogeneous depending on actors, location, timing and firms’ characteristics. The Afghan conflict has the specificity of deeply involving foreign countries. Mobilizing this particular source of exogenous variation, we identify the causal effect of an insecurity reduction on formal firms’ existence. We show that an increase of 1% in the exposure to instrumented military events raises the formal activity probability by 3.8%.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"180 ","pages":"Article 103714"},"PeriodicalIF":4.6,"publicationDate":"2026-01-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145977313","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-07DOI: 10.1016/j.jdeveco.2026.103718
Lorenzo Aldeco Leo , Matteo F. Ghilardi , Hugo Tuesta
This paper explores how fluctuations in crime rates influence labor market outcomes in Mexico. Using detailed survey data and an individual-fixed effect estimation, the analysis reveals distinct gender dynamics in response to rising homicide rates. Men are more likely to exit the labor market, while women increasingly join the workforce, mainly in the informal sector. This pattern is consistent with an added-worker effect, which we document using household-level evidence. This outcome is largely driven by the presence of drug trafficking organizations, which primarily employ men in their operations. Escalating violence also increases labor mobility, leading to higher job separations, especially among women. Our results highlight that while increasing crime in the form of homicides may not induce large changes in the aggregate level of employment, there is evidence of labor reallocation across and within sectors. This suggests an increase in labor market misallocation.
{"title":"Labor market consequences of homicides: A gender perspective from Mexico","authors":"Lorenzo Aldeco Leo , Matteo F. Ghilardi , Hugo Tuesta","doi":"10.1016/j.jdeveco.2026.103718","DOIUrl":"10.1016/j.jdeveco.2026.103718","url":null,"abstract":"<div><div>This paper explores how fluctuations in crime rates influence labor market outcomes in Mexico. Using detailed survey data and an individual-fixed effect estimation, the analysis reveals distinct gender dynamics in response to rising homicide rates. Men are more likely to exit the labor market, while women increasingly join the workforce, mainly in the informal sector. This pattern is consistent with an added-worker effect, which we document using household-level evidence. This outcome is largely driven by the presence of drug trafficking organizations, which primarily employ men in their operations. Escalating violence also increases labor mobility, leading to higher job separations, especially among women. Our results highlight that while increasing crime in the form of homicides may not induce large changes in the aggregate level of employment, there is evidence of labor reallocation across and within sectors. This suggests an increase in labor market misallocation.</div></div>","PeriodicalId":48418,"journal":{"name":"Journal of Development Economics","volume":"180 ","pages":"Article 103718"},"PeriodicalIF":4.6,"publicationDate":"2026-01-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145926377","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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