Climate Shocks and Social Norms: Evidence from Mafia-Affected Communities

This paper studies how climate shocks shift norms of silence and crime reporting in mafia-affected communities. We use a 2004–2023 panel for municipalities in Southern Italy’s Terra dei Fuochi, matching extreme-weather disasters to crime reports from the Centro Analisi Criminale and to municipal housing prices. In municipalities long exposed to mafia-driven toxic dumping, we exploit the staggered timing—after the 2013 public disclosure of the environmental emergency—of each municipality’s first severe climate disaster in a difference-in-differences design. Crime reporting displays positive but imprecisely estimated responses after a disaster, while extortion reporting increases sharply and persistently. We rationalize these patterns with a wealth-compression mechanism: floods depress housing wealth while mafia “taxes” remain fixed, raising the real burden of extortion and the cost of maintaining omertà. Consistent with this channel, residential property prices fall by roughly six percent after a disaster, while detailed municipal accounts show no contemporaneous expansion in policing, transfers, or civil-protection spending that could mechanically raise reporting.