Illegal drug trafficking and economic development in Colombia

The three essays cover the economic, political and institutional aspects of the impact drug smuggling activities have had on the Colombian economy. In the first essay, I examine drug smuggling activities as factors of institutional change forcing Colombia to adopt an export-led growth model of economic development. Revenues earned by illegally introducing drugs into industrialized countries were recycled through the parallel foreign exchange market and used to finance illegal imports. The industrialist class which had formally enjoyed a protected market was now forced to compete. The old privileges gone, the industrialist class had no incentive to support the existing inward-oriented model in the presence of "de facto" competition in their sectors and, thus, willingly accepted the "Apertura" program.