Mafia, education, and emigration

The mafia and similar organization are a tumor on an economy. They divert the effort of people to unproductive activities, they upset the rule of law and discourage entrepreneurship. But it is difficult to actually measure the impact of the mafia, because their is no measurement of its activities.

Nicola Coniglio, Giuseppe Celi and Cosimo Scagliusi use difference in the penetration of the mafia in various towns of Calabria, which they measured themselves, to tease out from the data that mafia presence decreases education and increases emigration. Intuitively this makes sense: why you want to get educated if it is not rewarded, i.e., educated people have more income and are more likely to be business owners and thus have to pay a protection fee to the mafia. The only way to avoid this is to emigrate.

More interesting than the obvious is the size of the effect. The historical presence of the mafia in a town decreases the proportion of high school graduates by two percentage points. This is not negligible, as only about a quarter of the population has such a degree.