Illegal drugs and public corruption: Crack based evidence from California

Alessandro Flamini, Babak Jahanshahi, Kamiar Mohaddes

Research output: Contribution to journalArticlepeer-review


Do illegal drugs foster public corruption? To estimate the causal effect of drugs on public corruption, we adopt the synthetic control method and exploit the fact that crack cocaine markets emerged in California in 1981, before reaching any other U.S. state. Our results show that public corruption more than tripled in California in the first three years following the arrival of crack cocaine. We argue that this resulted from the particular characteristics of illegal drugs: cheap technology and rigid demand, which fosters a convergence of interests between criminals and corrupted public officials resulting in a positive causal impact of illegal drugs on corruption.
Original languageEnglish
Article number102005
JournalEuropean Journal of Political Economy
Early online date20 Feb 2021
Publication statusE-pub ahead of print - 20 Feb 2021


  • public corruption
  • crack cocaine
  • Synthetic Control Method
  • synthetic control
  • illegal drugs
  • law enforcement
  • difference in difference
  • organized crime


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