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International Narcotics Trade, Foreign Aid, And Enforcement

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  • Reza Oladi
  • John Gilbert

Abstract

Using a general equilibrium model of a developing narcotics-producing and -exporting economy, we analyze the economic effects of policies designed to restrict the production and trade of narcotics: foreign aid tied to anti-narcotics law enforcement activities, demand reduction policies, and alternative development policies. We characterize the problem as one of serious factor market distortions introduced by illicit production and enforcement. While aid to enforcement generally reduces the production and export of narcotics, it is less effective for economies with market power, and under plausible conditions may raise narcotics output and have negative welfare implications for the recipient . ( JEL F1)

Suggested Citation

  • Reza Oladi & John Gilbert, 2015. "International Narcotics Trade, Foreign Aid, And Enforcement," Economic Inquiry, Western Economic Association International, vol. 53(3), pages 1630-1646, July.
    • Handle: RePEc:bla:ecinqu:v:53:y:2015:i:3:p:1630-1646
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    File URL: http://hdl.handle.net/10.1111/ecin.2015.53.issue-3
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    Cited by:

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    2. Greenfield, Victoria A. & Bond, Craig A. & Crane, Keith, 2017. "A household model of opium-poppy cultivation in Afghanistan," Journal of Policy Modeling, Elsevier, vol. 39(5), pages 741-761.
    3. Ahsan Kibria & Reza Oladi & Sherzod B. Akhundjanov, 2020. "Foreign direct investment and civil violence in Sub‐Saharan Africa," The World Economy, Wiley Blackwell, vol. 43(4), pages 948-981, April.

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    JEL classification:

    • F1 - International Economics - - Trade

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