The Opec Boys and the political economy of smuggling in northern Uganda

In this article, we unearth the institution for enforcement of the agreement between the Opec Boys, fuel smugglers and ex-rebels, and a politician, who allows them to conduct illegal smuggling. Rather than the Opec Boys� threat of rebellion, their promise of political support and refraining from civil disorder matters to inflict cooperation. A repeated play mechanism where the players punish each other for defection but return to cooperation makes up the �rules of the game�. Uncovering this endogenously emerged institution for contract enforcement explicitly reveals the importance of political alliances in the second economy in a fragile state environment.