Opium for the Masses? Conflict-Induced Narcotics Production in Afghanistan
AbstractWe show that the recent rise in Afghan opium production is caused by violent conflicts. Violence destroys roads and irrigation, crucial to alternative crops, and weakens local incentives to rebuild infrastructure and enforce law and order. Exploiting a unique data set, we show that Western hostile casualties, our proxy for conflict, have strong impact on subsequent local opium production. This proxy is shown to be exogenous to opium. We exploit the discontinuity at the end of the planting season: Conflicts have strong effects before and no effect after planting, assuring causality. Effects are strongest where government law enforcement is weak.
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Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2573.
Date of creation: 2009
Date of revision:
conflict; narcotics production; resource curse; Afghanistan;
Other versions of this item:
- Lind, Jo Thori & Moene, Karl Ove & Willumsen, Fredrik, 2009. "Opium for the Masses? Conflict-induced Narcotics Production in Afghanistan," Memorandum 05/2009, Oslo University, Department of Economics.
- D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances
- H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
- K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
- O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
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