Illegal drugs, anti-drug policy failure, and the need for institutional reforms in Colombia.

This paper is inspired by two anomalies encountered in the study of the illegal drugs industry. First, despite the very high profits of coca/cocaine and poppy/opium/heroin production, most countries that can produce do not. Why, for example, does Colombia face much greater competition in the international coffee, banana, and other legal product markets than in cocaine? And second, though illegal drugs are clearly associated with violence, why is it that illegal drug trafficking organizations have been so much more violent in Colombia and Mexico than in the rest of the world? The answers to these questions cannot be found in factors external to Colombia (and Mexico). They require identifying the societal weaknesses of each country. To do so, the history of the illegal drugs industry is surveyed, a simple model of human behavior that stresses the conflict between formal (legal) and informal (socially accepted) norms as a source of the weaknesses that make societies vulnerable is formulated. The reasons why there is a wide gap between formal and informal norms in Colombia are explored and the effectiveness of anti-drug policies is considered to explain why they fail to achieve their posited goals. The essay ends with reflections and conclusion on the need for institutional change.