Drug trafficking and the homicide epidemic in the Caribbean Basin

Most of the world’s highest homicide rates are found in the Caribbean basin. Common explanations for the region’s violence—such as inequality and long-standing culture—fail to explain the explosive growth of violence in recent decades. This paper examines the role of drug trafficking, a leading explanation among law enforcement but one that is difficult to establish causally due to the illicit and covert nature of the trade. I leverage an exogenous shock to drug trafficking: the 1973 Chilean coup, which abruptly redirected trafficking routes northward to Colombia and through the Caribbean. Using Puerto Rico, the Caribbean territory with the best data coverage, and a synthetic control constructed from US states—which share federal gun laws and other policies affecting violence—I estimate that the shock caused a 50% increase in homicides. Evidence from other parts of the region supports drug trafficking as the key driver of the Caribbean’s extraordinarily high levels of violence.