This paper analyzes how coca cultivation affects the provision of basic household services in Colombia. In particular, I examine how different levels of government responded to an exogenous upsurge in coca cultivation in 1995. I use data from De- mographic Health Surveys to compare Colombian households’ access to electricity (overseen by the federal government) and water (overseen by municipal govern- ments) in coca growing areas relative to non-growing areas. I use both standard and generalized difference-in-differences models. My results indicate that after coca cultivation increased, electricity coverage increased by 7 percentage points more in coca growing departments than non-growing departments. In contrast, there were no differential trends in access to piped water between growing and non-growing departments.

Colombia differs from the rest of the world due to the amount of kidnappings and coca cultivation taking place. Using data between 1999-2008, this paper studies to what extent and in what direction there exists a causal relationship of coca cultivation on kidnappings. A study that has never been done in the previous published economic literature. A negative relationship would mean that policies implemented to reduce coca cultivation would also increase the number of kidnappings. A positive relationship, on the other hand would reduce the number of kidnappings. Using OLS-, fixed effects- and instrumental variable regressions, the results imply a negative relationship. Meaning implementing policies with the aim of eradicating coca production would come with negative externalities in the form of more kidnappings.