Organized Crime, Local Politicians, and State Capacity

This paper examines how the assassination of mayors affects local government capacity, leveraging the quasi-random variation in the success of assassination attempts against Mexican mayors. Compared to municipalities with failed attempts, tax collection falls by 28% and public expenditures shift from essential services to construction investments in municipalities with successful assassinations. There is suggestive evidence that disruptions to local government personnel contribute to these outcomes. Productive municipal workers leave, and retaining them would require an 11\\\\\\\\\\\\\\\\% wage increase. More personnel are reassigned from public service delivery to security duties. Non-political violence, economic activities, demographics, electoral environment, and the temporary rise in organized crime do not fully explain these outcomes. The results highlight how the loss of decision-makers in violent environments undermines local state capacity.