THE PRINCIPAL-AGENT PROBLEM AND PRO-GOVERNMENT MILITIAS: CASES FROM COLOMBIA AND PERU

States (principals) frequently employ pro-government militias (agents) in low intensity conflicts with mixed results. In some cases, principal and agent interests diverge or the principal loses control over its agent, which devolves into an autonomous terrorist, warlord, or criminal organization. Looking at historical cases of Latin American pro-government militias from Colombia (Self-Defense groups, Convivirs, and Hometown Soldiers) and Peru (Rondas Campesinas), I examined the principal-agent problem in the context of state-sponsored, pro-government militias and answered the following question: How do sponsor states succeed or fail in maintaining positive control and influence over pro-government militias? States fail when they grant too much autonomy and firepower to militias and succeed when they limit militias’ autonomy by subjecting them to a tailored combination of control mechanisms: monitoring, screening, sanctions, and rewards. Cases from Colombia and Peru demonstrate that the best way to control militias and employ them in counterinsurgency is by incorporating them as legitimate auxiliaries of the armed forces. Incorporation of a militia into the armed forces greatly reduces the principal-agent problem, the associated risk of diverging interests and objectives, and the future pain of demobilization. Arming militias with restricted use weapons, outsourcing their financing to private benefactors, and granting them too much autonomy is a recipe for disaster. http://archive.org/details/theprincipalagen1094559551 Lieutenant, United States Navy Approved for public release; distribution is unlimited.