After the tragic events on Saturday in El Paso, residents continue to process the emotional impact. Unfortunately, the tragedy will also manifest itself economically, as those affected must return to work to feed their families.

Tom Fullerton a professor of economics at the University of Texas-El Paso says there is growing evidence that violent crime and terrorism affect economic activity.

“What it does is displace from one part of the metropolitan economy to another area,” Fullerton says. “In other words, shoppers will go where it’s safer to shop.”

He says the issue of economic impact becomes more complicated when an international boundary is involved. The shopping area where the shooting occurred attracts customers from both sides of the border.

“The residents of Ciudad Juárez and other places in northern Mexico that would normally cross the border to shop in El Paso – those consumers are going to hesitate before making those shopping trips,” Fullerton says.

Studies of protracted violence in the six largest metropolitan areas along the international boundary indicate that for every two homicides, retail sales decline approximately 0.04%, Fullerton says.

“That doesn’t sound like much but if you translate it into a dollar value – that implies a loss of probably of excess $1 million,” Fullerton says.

In the case of El Paso, where 22 people were murdered, the collective impact could be somewhere around $10 million, Fullerton says.

“That represents a unrecoupable loss to the metropolitan economy, the regional economy and the national economy,” Fullerton says. “So, given the location of El Paso, this is a loss to the hemispheric economy as a whole.”

Fullerton says it’s still too early to predict the fate of the shopping complex.

“Regional economies do recover from these types of events. What will happen in terms of that specific Walmart location is not known at this point,” Fullerton says.

Written by Geronimo Perez.