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Assets confiscation, harsh imprisonment regime, and violence. On the long-run state-mafia interactions [Job Market Paper]
Presented at: Internal Seminar (University of Bologna), CLEAN seminar series (Bocconi, Milano), Internal Seminar (ENS, Lyon), XIII NERI workshop (University of Bari), Internal seminar (KU Leuven, Bruxelles), XVI VPDE workshop in Economics (Collegio Carlo Alberto and University of Turin)
ABSTRACT
I develop a model analyzing the interplay between the state and mafias. I demonstrate that targeting criminal profitability reduces conflicts within criminal organizations but increases retaliation against the state, while strengthening non economic law enforcement decreases both. Employing data on Italian mafias, I empirically validate these predictions by examining the effects of the introduction and staggered implementation of Italy's asset forfeiture law and harsh imprisonment regime on homicides of public officials and mobsters. Additionally, I instrument confiscations with two sources of exogenous variations in illegal profits, namely U.S. drug demand and public funds allocated after natural disasters. Synthetic control methods further support the findings: while harsh imprisonment reduces both types of violence, asset confiscations have opposing effects on internal and external homicides. Overall, this paper offers a multi-phase explanation of the state-mafia interactions that can be generalized to other contexts, such as Colombia and Mexico. This identifies previously proposed short-term phenomena such as the electoral violence argument as a special case of the present explanation.
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The Quiet Payoff: How Mafia Support buys Policy Inaction
(with Giovanni Righetto and Antonio Schiavone, paper draft available here)
Presented at: Internal Seminars (University of Bologna), NICEP conference (Nottingham), CLEAN seminar series (Bocconi, Milano), Fourth Junior Economists Meeting (University of Milano), XV NERI Workshop (University of Chieti-Pescara)
ABSTRACT
Organized crime groups are known to provide electoral support to politicians, but the rewards they obtain in return remain poorly understood. We develop a theoretical framework suggesting that modern mafia support hinges on parties’ willingness to weaken anti-mafia policies, specifically by neglecting the reallocation of confiscated mafia assets. Judicial records indicate that when these assets remain unassigned, crime families can quietly repossess them, turning policy inertia into a hidden payoff. Using data from Sicilian municipalities between 1992 and 2022, we first detect vote manipulation in tightly contested majoritarian races—particularly in smaller towns—indicating strategic vote buying by the mafia. A regression discontinuity design, restricted to comparable municipalities quasi-randomly sorted around the threshold, reveals that narrowly won Forza Italia victories trigger a sharp fall in asset reallocations only within mafia-controlled areas. To measure variation in vote‑buying capacity, we exploit the mafia’s abrupt 1987 withdrawal of support from the Christian Democrats. Municipalities suffering larger DC vote losses—our proxy for historical mafia influence—experience steeper post‑election cuts in asset reallocations, but only during Berlusconi’s governments. Instrumenting modern Forza Italia support with these historical shifts further supports a causal relation between mafia vote buying and national‑level policy concessions.
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Organized Crime, Violence, and Targeted Repression
(with Piero Manfredi & Paolo Vanin)
Presented at: 2nd Year PhD Forum (Unibo), Internal seminars (University of Bologna and UdeSA, Buenos Aires)
ABSTRACT
We study the effects of targeted repression of organized crime on inter-clan violence and illegal activity. We investigate the possible trade-off between curbing violence and illegal activity. If clans fight for territorial control, targeting the strongest ones reduces violence, but if surviving clans are the most productive, it also boosts illegal activity and profits. Targeting the weakest clans has opposite effects. If instead clans are able to sustain a peaceful territory-splitting agreement, targeting the strongest clans may raise violence by triggering a succession war. Conversely, targeting the weakest clans may allow the strongest ones to peacefully thrive. Our theoretical analysis helps interpret the evolution of violence and illegal activity after different kinds of repressive policy adopted in Italy, Mexico and Colombia.
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The paradox of power play
Presented at: Internal Seminar (University of Bologna), Internal Seminar (ENS, Lyon)
ABSTRACT
I model an asymmetric conflict and demonstrate that, under fairly general conditions, economically disadvantaged factions derive greater benefits from warfare, even when they neither outnumber nor surpass their opponents in military strength. This occurs because, although they are less likely to achieve victory, they stand to gain more and lose less from engaging in conflict. Extending the time horizon, I show that rising wealth inequality systematically increases the likelihood — not merely the incentive — for the poorer faction to initiate a dispute against the wealthier one. This dynamic creates a trade-off: while resource redistribution reduces the incentive for poorer factions to initiate conflict, it simultaneously raises the incentive for wealthier factions, resulting in an ambiguous net effect on the overall probability of war. I test the model’s key theoretical predictions using a comprehensive dataset of militarized interstate disputes spanning the past two centuries. To identify exogenous variation in GDP per capita differences, I exploit shocks to commodity prices and fluctuations in temperature and rainfall.
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Cracking the code: assessing and countering mafia penetration in public procurement
(with Chiara Notarangelo)
Awards: finalist at the 2023 Tortuga Call for Policy Papers
ABSTRACT
We use a game theory model to demonstrate that mafia influence discourages public investments in regions where criminal organizations have not yet permeated the legitimate economy. Conversely, in areas where organized crime has already entrenched itself, the presence of mafia is shown to foster investments as a strategic move to secure lucrative public contracts. This intriguing dichotomy forms a U-shaped association between regional wealth and mafia penetration. We test our theoretical predictions on a dataset of Sicilian municipalities. On the one hand, we find a negative correlation between mafia presence and public investments during the First Italian Republic (1946-1992), during which the mafia's sophistication level was insufficient to infiltrate the formal economy. On the other hand, we unveil a substantial allocation of resources from the Recovery fund (2020) to municipalities characterized by high mafia penetration. In both cases, we employ the existence of sulfur mines as an instrumental variable for assessing mafia presence. We then substantiate that the observed trend is also prevalent in areas formerly considered devoid of mafia presence. To address the recent problem of mafia penetration into public procurement, we propose PATMAPP, a novel index to evaluate the risk of mafia penetration for firms participating in calls for tenders.
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From Red to Scarlet: Political violence against the communist tide in the Italian anomaly
Presented at: Internal Seminars (University of Bologna), Seminar for New Academic Research (Open University of Catalonia, Barcellona)
ABSTRACT
I investigate the hypothesis surrounding the strategy of tension in Italy during the 1970s. The prevailing thesis suggests that rogue elements within the state orchestrated a series of terrorist attacks and acts of political violence to counter the growing support for the Italian Communist Party (PCI)—the strongest communist party in the Western world—and to pave the way for an authoritarian shift with the backing of far-right organizations. Using a game-theoretic model and an empirical analysis based on a novel dataset of terrorist attacks and political violence—including detailed information on location, timing, and the political affiliation of both perpetrators and victims—I demonstrate a positive association between terrorism, victimization, and PCI support. To reinforce these findings, I exploit local exogenous shocks to PCI support driven by the international turmoil of 1968–69, which mobilized the working class and university students against the central government, leading to a sharper increase in PCI consensus in provinces where they were more concentrated. Finally, I provide empirical evidence suggesting that mafia-related violence against left-wing activists in Southern Italy served a similar purpose—and had similar effects—as far-right terrorism in the North.