Houses for the People, Power for the Gangs: Criminal Capture of Social Housing in Brazil

Social housing policies aim to decrease inequality by expanding access to secure property rights for low-income families. We argue that large-scale social housing can generate territories of opportunity for criminal organizations when the state’s distributive capacity outpaces its coercive capacity. We exploit population thresholds governing Brazil’s Minha Casa, Minha Vida program and homicide data for all 5,570 municipalities in a fuzzy regression discontinuity design and a staggered difference-in-differences framework. Municipalities assigned more housing units experience higher homicide rates, with effects concentrated among demographic groups disproportionately exposed to organized criminal violence, and stronger in larger cities. Spatial difference-in-difference and spatiotemporal Durbin models using geocoded data on housing projects, criminal territorial control, and armed violence in metropolitan Rio de Janeiro show that housing projects contribute to criminal control and associated lethality. Our evidence traces how armed groups capture developments and extract rents from beneficiaries. The findings illuminate how redistributive policies, absent enforcement capacity, can unintentionally empower criminal governance.

Under Review. REPAL Conference Best Paper Award, 2025.