This paper develops a model of a war against the producers of illegal hard drugs. This war occurs on two fronts. First, to prevent the cultivation of crops that are the raw material for producing drugs the state engages the drug producers in conflict over the control of arable land. Second, to impede further the production and exportation of drugs the state attempts to eradicate crops and to interdict drug shipments. The model also includes an interested outsider who uses both a stick and a carrot to strengthen the resolve of the state in its war against drug producers. The results of the calibration of the model yield an estimate that from 2001 through 2003 subsidies from the United States to the Colombian armed forces under Plan Colombia caused a decrease in the exportation of drugs from Colombia to about 44 percent of what exportation was before Plan Colombia was implemented. The results of the calibration of the model also suggests that a more efficient allocation of the about $2 billion that the United States spent on Plan Colombia through 2003 would have involved larger subsidies to the conflict over control of arable land and smaller subsidies to eradication and interdiction efforts.
*Published:
Herschel Grossman & Daniel Mejía, 2008. "The war against drug producers," Economics of Governance, Springer, vol. 9(1), pages 5-23, January.
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