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Please use this identifier to cite or link to this item: https://hdl.handle.net/2445/112646
Law enforcement, municipal budgets and spillover effects: evidence from a quasi-experiment in Italy
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Abstract
In this paper, I empirically investigate the presence of spillover effects resulting from the strengthening of law enforcement against corruption and organized crime in local governments. Specifically, I take advantage of an Italian law that gives power to the central government to replace democratically elected municipal officials who are potentially connected with mafia with a commission of non-elected administrators. Fixed effects model estimates that focus on a sample of municipalities from three Italian regions (Campania, Calabria and Sicilia) for the period 1998 to 2013 show that the city council dismissal of a municipality fosters a reduction in public investments in neighboring municipalities. Additional empirical evidence suggests that this result could be explained by the presence of law enforcement spillovers potentially reducing misconducts in neighboring municipalities.
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GALLETTA, Sergio. Law enforcement, municipal budgets and spillover effects: evidence from a quasi-experiment in Italy. IEB Working Paper 2016/01. [consulted: 9 of August of 2026]. Available at: https://hdl.handle.net/2445/112646