This paper studies the effects of violent crime on market prices and size using plant-level panel data in Colombia. To estimate causal effects, I exploit reductions in violence driven by increases in security expenditures during Álvaro Uribe’s presidency; these resulted in greater violence reductions in municipalities that voted for him in the 2002 elections as he was looking for reelection. I find that firms that face higher violence also face lower output and input prices. Output prices fall more than the prices of inputs, which drives firms to reduce production, and some firms exit the market. Workers see reductions in their real income.

We document racial and ethnic disparities in the propensity of law enforcement to formally book juvenile arrests. A fair share of these disparities can be attributed to differences in arrest offense severity and arrest history as well as cross-agency differences in practice. The disparities are the largest for age ranges and offenses where the greatest discretion is exercised. We explore whether booked arrests increase the likelihood of future arrests and bookings exploiting the discontinuity in the booking probability at age 18. The results suggest sizable effects of a prior booking on the likelihood of a future arrest and subsequent booking.