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One Step Ahead of the Law: The Net Effect of Anticipation and Implementation of Colombia's Illegal Crops Substitution Program

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  • Ladino, J. F
  • Saavedra, S
  • Wiesner, D

Abstract

Pre-announced policies often generate anticipation effects that may end up in unin- tended consequences. But little is known about the extent to which the actual imple- mentation of the policy can offset these effects. Previous research have shown that the announcement of an illegal crop substitution program made coca cultivation increase substantially in Colombia, but the net effect of the policy has not been estimated. We use detailed data on both coca cultivation and substitution payments at 1km x 1km grid squares to estimate the net effect of the policy. Our data also allows us to study the geographical spillovers of the program to non-targeted neighboring areas. Using a difference-in-differences empirical strategy, we nd that program recipients reduced illegal crops by 94% with respect to the pre-program mean. Surprisingly, the reduction in neighboring (non-targeted) grid areas is of similar magnitude. However, these re- ductions are not enough to compensate for the large increase in coca growing that took place between the announcement and the implementation of the policy, and thus the net effect is negative. This suggest both that the early announcement was a mistake that led to a substantial one-time cost, but the ongoing substitution efforts will have the intended effects if continued.

Suggested Citation

  • Ladino, J. F & Saavedra, S & Wiesner, D, 2019. "One Step Ahead of the Law: The Net Effect of Anticipation and Implementation of Colombia's Illegal Crops Substitution Program," Documentos de Trabajo 17581, Universidad del Rosario.
  • Handle: RePEc:col:000092:017581
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    References listed on IDEAS

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    1. Fabio Sánchez Torres & Ana María Díaz, 2005. "Los Efectos Del Conflicto Armado En El Desarrollo Social Colombiano, 1990-2002," Documentos CEDE 3167, Universidad de los Andes, Facultad de Economía, CEDE.
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    Cited by:

    1. Diego A. Martin, 2023. "The Impact of a Rise in Expected Income on Child Labor: Evidence From Coca Production in Colombia," Growth Lab Working Papers 217, Harvard's Growth Lab.
    2. Bruno De Borger & Amihai Glazer & Stef Proost, 2021. "Rational Drivers and the Choice Between Congestion Tolls and Tradeable Permits: A Political Economy Model," CESifo Working Paper Series 8821, CESifo.
    3. Carvajal, Hernán, 2023. "Efectos de la suspensión de las aspersiones aéreas con glifosato sobre la deserción escolar en Colombia," Documentos CEDE 20307, Universidad de los Andes, Facultad de Economía, CEDE.
    4. Diego A. Martin, 2023. "The Impact of a Rise in Expected Income on Child Labor: Evidence From Coca Production in Colombia," CID Working Papers 150a, Center for International Development at Harvard University.
    5. Lucas Marín Llanes, 2020. "Unintended Consequences of Alternative Development Programs: Evidence From Colombia's Illegal Crop Substitution," Documentos CEDE 18468, Universidad de los Andes, Facultad de Economía, CEDE.
    6. Marín Llanes, Lucas & Fernández Sierra, Manuel & Vélez Lesmes, María Alejandra & Martínez González, Eduard & Murillo Sandoval, Paulo, 2024. "Coca-Based Local Growth and Its Socio-Economic Impact in Colombia," Documentos CEDE 21186, Universidad de los Andes, Facultad de Economía, CEDE.

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    More about this item

    Keywords

    Policy anticipation; Illegal Markets; Coca; Colombia;
    All these keywords.

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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