this paper, we solve this problem and identify the effects of aerial spraying using a natural experiment. In particular, we exploit a diplomatic friction between the governments of Colombia and Ecuador, which concluded with the compromise by the Colombian government not to carry out spraying campaigns within a 10 km strip along the international border with Ecuador, starting in 2006.

From the beginning of _Plan Colombia_ , the Ecuadorian government complained of alleged adverse effects of spraying on the health of its population, the environment, livestock, and legal crops near the bordering area. In 2006, the Colombian government announced that it would discontinue aerial spraying within a 10 km band along the international frontier with Ecuador within Colombian territory. However, the Colombian government recanted at the end of 2006 and continued spraying the area. As a result of this noncompliance with the initial agreement, the Ecuadorian government filed a lawsuit against Colombia in the International Court of Justice in The Hague. Since the suit was filed, on March 31st 2008, the Colombian government stopped all spraying campaigns within the 10 km strip.

The implementation of this exclusion area generated geographical and time variation in the likelihood of aerial spraying, which we exploit to identify its effects. Figure 2 shows a map of the exclusion strip and its location in Colombia.

# _Data_

We employ a unique panel of data on the location of coca crops within 1-square-kilometer (or 100 hectares) cells from 2000 to 2010. The data is collected and processed by the United Nations Office for Drugs and Crime (UNODC) in Colombia and comes from satellite images. Using these images, UNODC estimates the number of hectares with coca cultivation detected on each grid by the end of each year. We also use cell level data on the location of aerial spraying campaigns for the same period. The data is collected by the Colombian police using GPS devices, and it records the exact location of the plane when the spraying valves are open. Using these observations we code a dummy of whether a grid was sprayed or not, for each year from 2000 to 2010.<sup>3</sup> We restrict our sample to all grid points with centroids located within 20 km of the international frontier with Ecuador. Our sample includes 10,880 cells. We refer to the 5,613 cells within 10 km of the frontier as the exclusion region, since this is the area that Colombia agreed not to spray. In contrast, we refer to the 5,275 cells located 10 km to 20 km from the frontier as the sprayed area, as these cells were sprayed throughout our period of analysis. Both regions are depicted in figure 2.

To summarize the data, figure 3 presents the likelihood of aerial spraying (left panel) and the average number of hectares with coca crops per square kilometer (right panel) in both regions from 2000 to 2010. As anticipated above, the figure reveals similar patterns before 2006, with the exception of 2004. However, and consistent with the description of the natural experiment we exploit, a significant gap opens up beginning in 2006, when the Colombian government first agreed to reduce the spraying campaigns in the exclusion area. The data shows that the Colombian government still sprayed the exclusion area in 2006 and 2007, but considerably less than the sprayed region, where about 20% of the cells were sprayed. — However, spraying of the exclusion area falls to virtually zero, effectively since 2008 the year in which Ecuador filed the lawsuit against Colombia in international courts.

The data on cultivation reveals a sharp decline from 2000 to 2004, during the first years of _Plan Colombia_ , from about 3 hectares per square kilometer to about 0.6. However, in 2006, 3 Moreover, we use data on whether manual eradication campaigns took place on each grid, covering the 2007–10 sub-period. These data are obtained from GPS devices used by manual eradication teams.