We model the war on drugs in source countries as a conflict over scarce inputs in successive
levels of the production and trafficking chain, and study how policies aimed at different
stages affect prices and quantities in upstream and downstream markets. We use the model
to study Plan Colombia, a large intervention aimed at reducing the downstream supply of
cocaine by targeting illicit crops and blocking the transport of cocaine outside this source
country. The model fits the main patterns found in the data, including the displacement of the …

We model the war on drugs in source countries as a conflict over scarce inputs of successive
levels of the production and trafficking chain. We explicitly model the vertical structure of the
drug trade as being composed of several stages, and study how different policies aimed at
different stages affect the supply, prices and input markets. We use the model to study Plan
Colombia, a large scale intervention in Colombia aimed at reducing the supply of cocaine by
targeting illicit crops and illegal armed groups' control of the routes used to transport drugs …