Kingpins fall, prices dont: How cartels defy the rules of economics

Published: Monday, February 23, 2026 at 4:31 pm

Cartel Kingpin Death Fails to Disrupt Drug Prices

The recent death of a prominent drug trafficker, Nemesio Rubn Oseguera Cervantes, also known as "El Mencho," the leader of the Jalisco New Generation Cartel, has once again highlighted the resilience of the global drug trade. Despite the removal of a major player, the expected economic consequences – namely, a rise in drug prices due to supply disruption – have not materialized. This phenomenon challenges basic economic principles, which suggest that scarcity in a risky black market should drive prices upward.

Economists like Tom Wainwright, author of "Narconomics: How to Run a Drug Cartel," attribute this stability to the structural nature of cartels. Unlike traditional businesses, cartels operate as decentralized corporations, designed to withstand leadership changes and protect their distribution networks. The removal of a leader, therefore, rarely cripples the entire operation.

Furthermore, cartels exert significant control over their supply chains, particularly over the farmers who cultivate coca, the base ingredient for cocaine. In many coca-growing regions, a single trafficking group dominates, effectively controlling the price paid to farmers. This dominance allows cartels to insulate themselves from rising costs. As Wainwright explains, cartels can maintain their profits by squeezing coca farmers, preventing any increase in the price of cocaine for consumers. This tight grip on the supply chain means that even adverse conditions for coca farmers primarily impact the farmers themselves, without significantly affecting cartel profits or consumer prices.

BNN's Perspective: The ongoing struggle against drug cartels presents a complex challenge. While law enforcement efforts to remove kingpins are important, they are insufficient on their own. The cartels' structural resilience and control over the supply chain demonstrate the need for a multifaceted approach. This includes addressing the economic vulnerabilities of coca farmers and disrupting the cartels' control over the supply chain.

Keywords: drug cartels, El Mencho, Jalisco New Generation Cartel, drug prices, supply chain, coca farmers, Narconomics, economics, black market, kingpin, cocaine, trafficking, market stability

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