Exposure to Local Homicides and Early Educational Achievement in Mexico

We investigate the effect of children's exposure to local violence on grade failure in Mexico. We construct an annual panel of all elementary schools from 1990 to 2010 and merge municipality-level homicide rates to analyze the effect of exposure to local homicide. Using a variety of causal inference techniques, we consistently find that exposure to local violence increases the probability of failing a grade in elementary school. This effect is net of demographic, economic, and migratory trends usually associated with violence and is likely driven by heightened fear and anxiety and change in parenting practices. Our findings suggest that violent crime in children's environments compromises early educational achievement and may have long-lasting consequences on human capital formation and economic well-being.