Empirical Essays on Clientelism, Favouritism and Cartel Violence at the End of the PRI Regime in Mexico.

This thesis presents three empirical cases, each originated by separate main political economy events that took place in recent times in Mexico, namely the 1992 agricultural reform implemented in the country, the probable association between the PRI regime and cartels in the nation and the increase of cartel related violence in Mexico during the end of the PRI regime and the start of the democratization period in the nation. The initial empirical chapter studies the key political structure changes in 1992 that the country experienced. Particularly, the ejido dismantling and an increase in policy instruments manipulation by the PRI. Concretely, this paper examines the impact of public and municipality investment, and a granting property titles program, PROCEDE, on the political outcomes of the PRI by employing a unique nationwide dataset at the municipality level for the 1997-1991 period. To find evidence of those effects, we exploit the observed heterogeneity on the percentage change in ejido certification, public and municipality investment across municipalities as identifying sources of variation and employ a first differences design that holds unobserved local characteristics fixed. The subsequent chapter explores how cartels and political favouritism drive the allocation and generation of local resources across constituencies. Particularly, we study the extent to which the favouritism between Mexican cartels activities and the PRI regime in Mexico affects the creation and allocation of local resources for the 1991-2006 period. The final empirical chapter investigates the origins of the dramatic escalation of the Mexican drug war escalation since 2007. In accordance with the theory, its origin is in the 1990s turf wars involving the main drug trafficking organisations operating in the country. To this end, this study examines empirically the main cause of turf wars at the municipal level between 1995-2006. Overall, our results indicate that the PRI regime and its fall in the late 90’s was a crucial event for the socioeconomic dynamics in Mexico.