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

33 Pages Posted: 20 Apr 2016

See all articles by Daniel Mejia

Daniel Mejia

Universidad de los Andes, Colombia - Department of Economics

Pascual Restrepo

Boston University - Department of Economics

Sandra Rozo

University of Southern California - Schaeffer Center for Health Policy and Economics; The Word Bank, Research Group

Date Written: September 2, 2015

Abstract

This paper studies the effects of enforcement on illegal behavior in the context of a large aerial spraying program designed to curb coca cultivation in Colombia. In 2006, the Colombian government pledged not to spray a 10 km band around the frontier with Ecuador due to diplomatic frictions arising from the possibly negative collateral effects of this policy on the Ecuadorian side of the border. This variation is used to estimate the effect of spraying on coca cultivation by regression discontinuity around the 10 km threshold and by conditional differences in differences. The results suggest that spraying one additional hectare reduces coca cultivation by 0.022 to 0.03 hectares; these effects are too small to make aerial spraying a cost-effective policy for reducing cocaine production in Colombia.

Keywords: Armed Conflict

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 (September 2, 2015). World Bank Policy Research Working Paper No. 7409, Available at SSRN: https://ssrn.com/abstract=2655254

Daniel Mejia (Contact Author)

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

Carrera 1 No. 18 A - 10
Bogotá, AA4976
Colombia
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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 - Schaeffer Center for Health Policy and Economics ( email )

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

The Word Bank, Research Group ( email )

Malaysia

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