The Drug-Laden balloon: US military assistance and coca production in the Central Andes

31 July 2006

This article explores the empirical effects of U.S. drug policy on coca cultivation in the Central Andes. It assesses the impact of U.S. military assistance on the production of coca in the Central Andes, while controlling for other explanatory variables that influence coca cultivation.

This study is consistent with existing literature that points out the obstacles governments face as they attempt to suppress illicit goods. Specifically, our empirical findings support the idea of the ‘‘balloon effect,’’ whereby government efforts to ‘‘squeeze’’ illicit trade in one area result in the expansion of that trade elsewhere.