Intuitively, by increasing the opportunity cost of engaging in criminal activities, positive economic shocks should reduce crime. However, the empirical evidence on the relationship between economic shocks and criminal behavior is at best ambiguous. This may be because certain types of shocks...

How should a state which lacks the monopoly of violence go about acquiring it? We investigate the use of high-powered incentives for members of the Colombian army as part of a strategy to combat left-wing guerillas and build the state's monopoly of violence. We show that this top-down...