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The Dose Response of Criminal Groups: Effects on Homicides and School Dropout

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I study the impact of the number of Mexican Drug Trafficking Organizations (DTOs) on homicides and school dropout in Mexican municipalities between 2006 and 2018. I find that as DTOs increase, there is a significant increase in homicides. Having 8 DTOs, the largest amount observed in my data, causes a 16-fold increase in homicides relative to the overall mean. Moreover, the relationship is increasing and convex, contrary to popular models of crime. Additionally, I find increased DTOs also increase local school dropout in middle school. These effects are concentrated amongst older and male students. I find no effects for younger or female students. The gendered and age-differentiated results suggest a recruitment channel from the DTOs, who rely on adolescent males for their workforce. Consistent with this mechanism, I find that as DTOs increase in number, the number of adolescent crimes with middle-school dropouts as perpetrators increase.

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