The spillover effects of conflict on economic growth along the U.S.-Mexico border

Karen Trevino, University of Texas at El Paso


The violence and insecurity that Mexico has suffered since former President Calderon's war on drugs has come at a grave economic cost to the cities most affected. Businesses and citizens in counties that shared a border with the United States, however, have the ability to move their capital and businesses in search of regaining profits that had been lost due to the insecurity in their cities. These specific counties are considered to be interdependent borderlands, which signify that these borders are in a border region where one nation is symbiotically linked with the border region of an adjoining country. This research seeks to show that increased border violence causes a positive economic spillover in the interdependent borderland by exploring the relationship between violence in one border city and economic growth in the neighboring city for six Mexico-U.S. border counties from 2005 to 2011. This study will be tested with a linear regression with panel-corrected standard errors using lagged dependent variables. The independent variables consist of organized crime related homicides, kidnappings, and extortions. The dependent variables consist of gross total sales, gross retail sales, taxable sales, taxable retail sales, accommodation/food service sales, and total establishments. The study controls for unemployment rates due to the recession the U.S. suffered during the time of the study.

Subject Area

Economics|Political science|Public policy

Recommended Citation

Trevino, Karen, "The spillover effects of conflict on economic growth along the U.S.-Mexico border" (2014). ETD Collection for University of Texas, El Paso. AAI1562071.