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On the Effects of Enforcement on Illegal Markets: Evidence from A Quasi-Experiment in Colombia

31 Pages Posted: 16 Aug 2014  

Daniel Mejia

Universidad de los Andes, Colombia - Department of Economics

Pascual Restrepo

Boston University - Department of Economics

Sandra Rozo

University of Southern California - Marshall School of Business; University of Southern California - Schaeffer Center for Health Policy and Economics

Multiple version iconThere are 2 versions of this paper

Date Written: August 15, 2014

Abstract

This paper studies the effects of enforcement on illegal behavior in the context of coca cultivation in Colombia. We explore the deterrent effects of a large aerial spraying program designed to curb cocaine supply. We exploit variation induced by a diplomatic friction between the governments of Colombia and Ecuador over the possible negative effects of spraying campaigns over Ecuadorian territory. As a result of this friction, Colombia pledged to stop spraying campaigns within a 10 km band along the border with Ecuador in 2006. We estimate the effects of spraying on cultivation by regression discontinuity around the 10 km threshold and conditional differences in differences, using satellite data for 1-square-km cells. Our results suggest that spraying one additional hectare reduces coca cultivation by about 0.02 to 0.065 hectares, consistent with the view that enforcement reduces illegal behavior. However, these effects are too small to make aerial spraying a cost-effective anti-narcotic strategy.

Keywords: Illegal Markets, War on drugs, Crime, Enforcement

JEL Classification: O13, O33, O54, Q18

Suggested Citation

Mejia, Daniel and Restrepo, Pascual and Rozo, Sandra, On the Effects of Enforcement on Illegal Markets: Evidence from A Quasi-Experiment in Colombia (August 15, 2014). Available at SSRN: https://ssrn.com/abstract=2480999

Daniel Mejia (Contact Author)

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

Carrera 1 No. 18 A - 10
Bogotá, AA4976
Colombia
57(1)3394949 ext 3737 (Phone)
57(1)3324492 (Fax)

HOME PAGE: http://economia.uniandes.edu.co/share/scripts/home/home.php

Pascual Restrepo

Boston University - Department of Economics ( email )

Sandra Rozo

University of Southern California - Marshall School of Business ( email )

701 Exposition Blvd
Los Angeles, CA 90089
United States

HOME PAGE: http://www.sandravrozo.com

University of Southern California - Schaeffer Center for Health Policy and Economics ( email )

635 Downey Way
Los Angeles, CA 90089-3333
United States

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