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The Rise and Persistence of Illegal Crops: Evidence from a Naive Policy Announcement

Author

Listed:
  • Mejía, D
  • Prem, M
  • Vargas, J. F
Abstract
Well-intended policies often have negative unintended consequences if they fail to foresee the different ways in which individuals may respond to the new set of incentives. When widespread and persistent, these may lead to a net reduction of social welfare. Focusing on the case of anti-drug policies, in this paper we show that the recent unprecedented surge in the growing of illicit coca crops in Colombia was the result of a naive and untimely policy announcement during peace negotiations between the government and the FARC guerrillas. On May 2014, the parties peace delegations issued a press release announcing that coca-growing farmers would receive material incentives for voluntary crop substitution once a final agreement had been reached. To evaluate the anticipation effect of this announcement we exploit the cross sectional variation on both the cost advantage of growing coca (using an ecological measure of coca suitability) and the expected benefits of doing so (using a predicted measure of where the material benefits would have been targeted). Coca plantations levels remained high even after the implementation of the announced incentives scheme. We explain this persistence by documenting that the surge in coca growing is differentially higher in areas with presence illegal armed groups, that benefited financially from availability of a key input in the drug trade.

Suggested Citation

  • Mejía, D & Prem, M & Vargas, J. F, 2019. "The Rise and Persistence of Illegal Crops: Evidence from a Naive Policy Announcement," Documentos de Trabajo 17552, Universidad del Rosario.
    • Handle: RePEc:col:000092:017552
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    Cited by:

    1. Giacomo Battiston & Gianmarco Daniele & Marco Le Moglie & Paolo Pinotti, 2022. "Fueling Organized Crime: The Mexican War on Drugs and Oil Thefts," "Marco Fanno" Working Papers 0286, Dipartimento di Scienze Economiche "Marco Fanno".
    2. Nino, Gustavo & Baylis, Kathy & Crost, Benjamin, 2022. "Conflict and Small-scale Investment: Evidence from Colombia Peace Agreement," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322323, Agricultural and Applied Economics Association.
    3. Perilla, Sergio & Prem, Mounu & Purroy, Miguel E. & Vargas, Juan F., 2024. "How peace saves lives: Evidence from Colombia," World Development, Elsevier, vol. 176(C).
    4. German Orbegozo, 2021. "Consequences of violence against social leaders in Colombia," Documentos CEDE 19320, Universidad de los Andes, Facultad de Economía, CEDE.
    5. Guerra-Cújar, María Elvira & Prem, Mounu & Rodriguez-Lesmes, Paul & Vargas, Juan F., 2020. "The Peace Baby Boom: Evidence from Colombia’s peace agreement with FARC," SocArXiv c2ypd, Center for Open Science.
    6. Mora-Garcia, Claudio A & Prem, Mounu & Rodriguez-Lesmes, Paul & Vargas, Juan F., 2024. "Health Workforce Reallocation in the Aftermath of Conflict: Evidence from Colombia," Documentos de Trabajo 21124, Universidad del Rosario.
    7. Marín Llanes, Lucas & Fernández Sierra, Manuel & Vélez Lesmes, María Alejandra & Martínez González, Eduard & Murillo Sandoval, Paulo, 2024. "Coca-Based Local Growth and Its Socio-Economic Impact in Colombia," Documentos CEDE 21186, Universidad de los Andes, Facultad de Economía, CEDE.
    8. Gelvez, Juan David, 2024. "Coca Politics: Electoral Accountability and Tough-on-Crime Policies in Colombia," OSF Preprints yn9rz, Center for Open Science.
    9. Angulo, Juan Carlos, 2024. "Books and bushes: Schooling decisions and coca production in Colombia," 2024 Annual Meeting, July 28-30, New Orleans, LA 344036, Agricultural and Applied Economics Association.
    10. Lucas Marín Llanes, 2020. "Unintended Consequences of Alternative Development Programs: Evidence From Colombia's Illegal Crop Substitution," Documentos CEDE 18468, Universidad de los Andes, Facultad de Economía, CEDE.
    11. Gelvez, Juan David & Angulo, Juan Carlos, 2024. "Public Attitudes Toward Forced Eradication: Protest, Gender, and Politics in Colombia," OSF Preprints 6ys2g, Center for Open Science.
    12. Ivan D. Lobo & Maria Alejandra Vélez, 2020. "From strong leadership to active community engagement: effective resistance to illicit economies in Afro Colombian collective territories," Documentos CEDE 17908, Universidad de los Andes, Facultad de Economía, CEDE.

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    More about this item

    Keywords

    Coca growing; Drug war; Anticipation effects; Policy announcement; Colombia;
    All these keywords.

    JEL classification:

    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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