The War on Illegal Drugs in Producer and Consumer Countries: A Simple Analytical Framework

28 Pages Posted: 20 Nov 2008

See all articles by Daniel Mejia

Daniel Mejia

Universidad de los Andes, Colombia - Department of Economics

Date Written: November 2008

Abstract

This paper develops a model of the war against illegal drugs in both producer and consumer countries. The paper studies the trade-off faced by the government of the drug consumer country between prevention policies (aimed at reducing the demand for drugs) and enforcement policies (aimed at reducing the production and trafficking of drugs), and shows how the optimal allocation of resources between these two alternatives depends on the key parameters of the model. We use available data for the war on drugs in Colombia, and against consumption in the U.S., to calibrate the unobservable parameters of the model, such as the price elasticity of demand for cocaine; the effectiveness of prevention and treatment policies; and the relative effectiveness of interdiction efforts.

Keywords: war on drugs, conflict, enforcement, prevention and treatment policies, Plan Columbia

JEL Classification: D74, K42

Suggested Citation

Mejia, Daniel, The War on Illegal Drugs in Producer and Consumer Countries: A Simple Analytical Framework (November 2008). CESifo Working Paper Series No. 2459, Available at SSRN: https://ssrn.com/abstract=1303384

Daniel Mejia (Contact Author)

Universidad de los Andes, Colombia - Department of Economics ( email )

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