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Rethinking America's Illegal Drug Policy

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  • John J. Donohue III
  • Benjamin Ewing
  • David Peloquin

Abstract

This paper provides a critical review of the empirical and theoretical literatures on illegal drug policy, including cross-country comparisons, in order to evaluate three drug policy regimes: criminalization, legalization and “depenalization.” Drawing on the experiences of various states, as well as countries such as Portugal and the Netherlands, the paper attempts to identify cost-minimizing policies for marijuana and cocaine by assessing the differing ways in which the various drug regimes would likely change the magnitude and composition of the social costs of each drug. The paper updates and evaluates Jeffrey Miron’s 1999 national time series analysis of drug prohibition spending and the homicide rate, which underscores the lack of a solid empirical base for assessing the theoretically anticipated crime drop that would come from drug legalization. Nonetheless, the authors conclude that given the number of arrests for marijuana possession, and the costs of incarceration and crime systemic to cocaine criminalization, the current regime is unlikely to be cost-minimizing for either marijuana or cocaine.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 16776.

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Date of creation: Feb 2011
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Publication status: published as
Handle: RePEc:nbr:nberwo:16776

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  1. Angela K. Dills & Jeffrey A. Miron & Garrett Summers, 2008. "What Do Economists Know About Crime?," NBER Working Papers 13759, National Bureau of Economic Research, Inc.
  2. DiNardo, John & Lemieux, Thomas, 2001. "Alcohol, marijuana, and American youth: the unintended consequences of government regulation," Journal of Health Economics, Elsevier, vol. 20(6), pages 991-1010, November.
  3. Louis Kaplow, 2004. "On the (Ir)Relevance of Distribution and Labor Supply Distortion to Government Policy," Journal of Economic Perspectives, American Economic Association, vol. 18(4), pages 159-175, Fall.
  4. Robert MacCoun & Peter Reuter & Thomas Schelling, 1996. "Assessing alternative drug control regimes," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 15(3), pages 330-352.
  5. Douglas Eckberg, 1995. "Estimates of early twentieth-century U.S. homicide rates: An econometric forecasting approach," Demography, Springer, vol. 32(1), pages 1-16, February.
  6. Gary S. Becker & Kevin M. Murphy & Michael Grossman, 2006. "The Market for Illegal Goods: The Case of Drugs," Journal of Political Economy, University of Chicago Press, vol. 114(1), pages 38-60, February.
  7. MacCoun Robert & Pacula Rosalie Liccardo & Chriqui Jamie & Harris Katherine & Reuter Peter, 2009. "Do Citizens Know Whether Their State Has Decriminalized Marijuana? Assessing the Perceptual Component of Deterrence Theory," Review of Law & Economics, De Gruyter, vol. 5(1), pages 347-371, June.
  8. Rosalie Liccardo Pacula & Beau Kilmer, 2003. "Marijuana and Crime: Is there a Connection Beyond Prohibition?," NBER Working Papers 10046, National Bureau of Economic Research, Inc.
  9. Rosalie Liccardo Pacula & Jamie F. Chriqui & Joanna King, 2003. "Marijuana Decriminalization: What does it mean in the United States?," NBER Working Papers 9690, National Bureau of Economic Research, Inc.
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Cited by:
  1. Ariaster B. Chimeli & Rodrigo R. Soares, 2011. "The use of violence ini llegal markets: evidence from mahogany trade in the Brazilian Amazon," Textos para discussão 592, Department of Economics PUC-Rio (Brazil).

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