Scandinavian Working Papers in Economics

Research Papers in Economics,
Stockholm University, Department of Economics

No 2004:13: How Do Drug Lords in Final Destination Countries Respond to Anti-Drug Policies?

Adam Jacobsson () and Alberto Naranjo ()
Additional contact information
Adam Jacobsson: Dept. of Economics, Stockholm University, Postal: Department of Economics, Stockholm University, S-106 91 Stockholm, Sweden
Alberto Naranjo: Dept. of Economics, Stockholm University, Postal: Department of Economics, Stockholm University, S-106 91 Stockholm, Sweden

Abstract: This paper models how drug lords in final destination countries respond to two types of government anti-drug policies: demand and supply oriented. Supply policies (crop eradication, interdiction, etcetera) are modeled in line with the previous literature, that is, they increase production costs. Demand policies (domestic law enforcement, demand reduction programs, etcetera) are modeled within a conflict framework with drug lords over the control of distribution channels for illegal drugs, which is novel. The model predicts drug use, price and indirectly drug related violent crime. These predictions appear to be consistent with the data.

Keywords: drug policy; conflict; violent crime

JEL-codes: D74; I18

20 pages, September 20, 2004

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