This chapter sets up the puzzle of how governments in weak institutionalized democracies regulate criminal markets and achieve relative order. While Latin America is the most violent region in the world, its criminal violence varies according to informal state responses to illicit markets. I collapse these responses into four types of informal regulatory arrangements: particularistic confrontations, particularistic negotiations, coordinated protection rackets and coordinated coexistence. A further intrigue is how elected politicians are able to contain drug-related violence with inefficient police departments prone to corruption and human rights abuses. I unpack the relationships between politicians and police, showing that different regulatory arrangements emerge from various combinations of political competition and police autonomy. This chapter then specifies the study’s research design and scope conditions (i.e., weakly institutionalized democracies) and lays out the plan for the book.

This chapter summarizes the book’s findings and discusses extensions of the argument. I outline the within-case and cross-case comparisons apparent in the four metropolitan areas covered in the previous chapters. I then briefly analyze to what extent the argument can apply to the regulation of drug markets in other Latin American metropolitan areas. I end the book with a series of theoretical and policy implications as well as potential research questions on the relationship between the state and illicit markets.

This chapter deploys the book’s theoretical framework, which connects political competition, police autonomy and informal regulation of illicit markets. While the electoral costs of police corruption and violence can motivate politicians to reduce police autonomy, political fragmentation and turnover condition whether and how they can achieve this objective. Fragmentation may obstruct policy implementation but also inhibit politicians from centralizing police rent extraction, while turnover impedes sustaining policies that reduce police autonomy over time. Police autonomy will shape how the police regulate drug markets. With greater autonomy police broker particularistic negotiations with, or engage in unbridled violence, or particularistic confrontation, against dealers and traffickers. When politicians reduce police autonomy through politicization, they capture rents from criminal activities and produce coordinated protection rackets, defined by high corruption but also lower violence on both sides. Finally, professionalized police forces regulate drug trafficking through coordinated coexistence regimes, brokering informal agreements that limit violence by both police and criminals.