This paper studies crime dynamics and police performance by analyzing an unprecedented policy shifting how individuals interact within the society: a nationwide lockdown. The paper disentangles the underlying mechanisms on how lockdowns affect crime and how diverse types of crimes evolve across different lockdown stages. To do so we use novel criminal case-level data for Bihar, India. First, using a regression discontinuity design in time, we estimate an immediate reduction in aggregate crime of nearly 60 per cent due to the lockdown. However, most types of crimes returned to prelockdown levels after a month and a half. Second, the crime reduction seems to be driven by the higher difficulties faced by criminals in finding potential victims. We observer a larger reduction in crime in districts where citizens had higher compliance with the lockdown (proxied by the number of crimes against public health) compared to districts with low compliance, meanwhile no differential impacts are observed across districts with distinct police strength. While lockdowns reduce the number of new crimes, they also decrease the police’s capacity for solving pending criminal cases. We find that the number of arrests associated with open criminal cases decreased by 86 per cent due to the lockdown. The impact is more severe in districts with lower police staff.
Reputation shocks and strategic reaction in electoral campaigns
This paper studies whether candidates adapt their campaign spending when beneficial or detrimental information affects a candidate's reputation. Using Brazilian elections and municipal audits as an exogenous source of reputation shocks, I find that both incumbent and challenger spending increases with detrimental shocks on the incumbent's reputation. In contrast, beneficial shocks decrease candidates' spending. Detrimental (beneficial) reputation shocks to the incumbent encourage (discourage) investment by making the election more (less) competitive. Furthermore, incumbents adapt a conditional cash transfers program by increasing (decreasing) the number of beneficiaries when detrimental (beneficial) reputation shocks occur.
This paper introduces a two-stage contest model with reference-dependent preferences to study the determinants of conflict and its intensity. I show the existence of a Subgame Perfect Nash equilibrium in pure strategies, and characterize the properties of the equilibrium. The model shows that reference points play a crucial role in the decision of waging war, and in the level of intensity of the conflict. The model delivers predictions in line with the evidence, and explains empirical regularities that previous models cannot account for. The model encompasses two of the most common empirical patterns found in the conflict literature. Conflicts are more likely to occur after negative income shocks due to the current situation being perceived as a loss compared to agents' reference points. Additionally, income reduces the odds of conflict if agents are more risk-averse for gains than risk-seeker for losses.
The Great Lockdown and criminal activity - Evidence from Bihar, India , CEPR COVID Economics, 2020, 1(29): 141-163.
Equilibrium with limited-recourse collateralized loans (2013) with J.P. Torres-Martínez, Economic Theory, 53: 181.