Professor Becker and Judge Posner are discussing the impact of crime epidemics on Latin American economies on their blog. Both primarily focus their discussion on the rise of rampant criminal activity plaguing Mexico City, but draw conclusions implicating a wider range of developing economies.
The discussion hits on an issue much broader than criminal activity, that is, one of general lawlessness. The two concepts are quite distinct - the former concerned with commission of acts, the latter with the government's inability/wariness of establishing and enforcing a fair, sensible, and enforceable legal code.
Prof. Becker and Judge Posner anecdotally describe how the many sidewalk vendors in Mexico City lose business because of decreased foot traffic - a result of likelihood that well-heeled pedestrians are likely to be robbed or kidnapped. This obviously deprives the vendor of those customers with the most expendable cash (i.e., those that can afford a private driver), working unique harms against those who can least afford to suffer them.
However, as eloquently and expertly described Hernando de Soto in The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else, lost foot traffic is not the only business malady confronting sidewalk vendors around the world, many of which operate in what de Soto refers to as the "extra-legal" realm. These micro-entrepreneurs pay significant sums of money for bribes, "protection," and an impaired (if not eliminated) ability to attract credit. De Soto goes to lengths to show that if given a reasonable opportunity to legally incorporate (rather than the multi-year process, wrought with time consuming bureaucracies, and registration fees), these small business owners do so in droves.
Implementation of the rule of law in the capture, prosecution, and ultimate deterrence of criminal acts is but one half of the equation to remedying the myriad problems facing the residents of (and visitors to) developing countries. Prof. Becker noted, inter alia, the interrelatedness of economic opportunity and criminal activity - and until the basic provision of a fair, sensible, and enforceable legal code can be implemented, it is difficult to imagine an effective remedy to stymie systemic criminal activity.