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date: 19 June 2019

Abstract and Keywords

Given the high profitability of the illegal cocaine industry, traditional economic models would predict that coca would grow and cocaine be refined in every country that could do so. The concentration of the coca-cocaine industry in Colombia requires an explanation different from the existence of a high illegal cocaine demand. This essay explores the structural and institutional contexts of Colombian society that allowed the illegal drug industry to become imbedded into the society. It traces the historical roots of the industry through the 1960s, its beginning in the 1970s with a marijuana boom, followed by a huge increase in cocaine trafficking in the following two decades, during which the two powerful cartels of Medellin and Cali controlled the cocaine trafficking and promoted coca and poppy plantings. The government succeeded in destroying the two large cartels, but the industry fragmented and a large number of smaller trafficking organizations developed. The success of the illegal industry attracted other actors, including left wing guerrilla and right wing paramilitary organizations. During Alvaro Uribe’s presidency (2002–2010), there was a very large increase in coca eradication and trafficker extradition efforts, and the fight against the guerrilla organizations intensified, but paramilitary groups and other small trafficking groups continued to operate successfully. While coca plantings fell, cocaine trafficking continued, defying the policy efforts. The essay ends with a sketch of a theory of the competitive advantage in illegal activities that argues that they have no direct causes and that illegal economic activities and organized crime tend to establish themselves in societies with physical and institutional structures that make them vulnerable and fertile ground for the development of those activities. This explains why traditional policies cannot achieve long-term sustainable success against the cocaine industry that is a symptom of unresolved social issues and social vulnerabilities.

Keywords: Colombian cartels, cartels’ evolution, narcoterrorism, drug violence, drugs and institution, competitive advantage, corruption, drug policies

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