The War on Illegal Drugs in Producer and Consumer Countries: A Simple Analytical Framework

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The War on Illegal Drugs in Producer and Consumer Countries: A Simple Analytical Framework

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Daniel Mejía ()

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Daniel Mejia

Abstract

This paper develops a model of the war against illegal drugs in both producer and consumer countries. The paper studies the trade-off faced by the government of the drug consumer country between prevention policies (aimed at reducing the demand for drugs) and enforcement policies (aimed at reducing the production and trafficking of drugs), and shows how the optimal allocation of resources between these two alternatives depends on the key parameters of the model. We use available data for the war on drugs in Colombia, and against consumption in the U.S., to calibrate the unobservable parameters of the model, such as the price elasticity of demand for cocaine; the effectiveness of prevention and treatment policies; and the relative effectiveness of interdiction efforts.

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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number CESifo Working Paper No. 2459.

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Date of creation: 2008
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Handle: RePEc:ces:ceswps:_2459

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Find related papers by JEL classification:
D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances
K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

Gary S. Becker & Kevin M. Murphy & Michael Grossman, 2006. "The Market for Illegal Goods: The Case of Drugs," Journal of Political Economy, University of Chicago Press, vol. 114(1), pages 38-60, February. [Downloadable!] (restricted)
Skaperdas, Stergios, 1996. "Contest Success Functions," Economic Theory, Springer, vol. 7(2), pages 283-90, February.
Other versions:
- Stergios Skaperdas, 1996. "Contest success functions (*)," Economic Theory, Springer, vol. 7(2), pages 283-290.
Herschel Grossman & Daniel Mejía, 2008. "The war against drug producers," Economics of Governance, Springer, vol. 9(1), pages 5-23, January. [Downloadable!] (restricted)
Other versions:
- Herschel I. Grossman & Daniel Mejia, 2005. "The War Against Drug Producers," NBER Working Papers 11141, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
Hirshleifer, Jack, 1991. "The Technology of Conflict as an Economic Activity," American Economic Review, American Economic Association, vol. 81(2), pages 130-34, May. [Downloadable!] (restricted)

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