On the Unintended Consequences of Enforcement on Illegal Drug Producing Countries

PWP-CCPR-2014-005

Abstract

This paper studies the effects of the biggest antidrug program ever applied in a drug producing country. I use satellite information on the exact location of coca crops between 2000 and 2010 in Colombia to identify the effects of spraying herbicides on coca production. I exploit the variation created by restrictions to spraying in protected areas (i.e., indigenous territories and natural parks) and the time variation of U.S. international antidrug expenditures to identify the effects of the program. My results suggest that coca cultivation is reduced by 0.07 hectares per additional hectare sprayed. However, spraying induces unintended negative effects on the welfare conditions of the treated areas and spillover effects in neighboring countries. Despite the reduction under coca cultivation, cocaine production remains steady due to a sharp increase on cocaine yields. In sum, the program's costs are by far higher than its potential benefits.