I am attempting a (very) basic analysis of smuggling from one economy to the other (Venezuela to Colombia) - arising from price ceilings ceteris paribus. e1 are the equilibria without intervention (price controls), e2 are the equilibria after price ceilings, and e3 show what I assume the markets would look like if Venezuelans supplied Colombia (by smuggling) where the Venezuelans' profit =
[Colombia p-hat - cost of smuggling - Venezuela p-hat]
The supply curve for Colombia becomes the sum of the Venezuelan and Colombian supply curves above the [Venezuelan price ceiling + cost of smuggling], while there is a movement along the Venezuelan supply curve to the point of [Colombian price ceiling - cost of smuggling].
Is this correct?