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The Demand for Cocaine and Marijuana by Youth

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Author Info
Frank J. Chaloupka
Michael Grossman
John A. Tauras

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Abstract

In recent years, the debate over the costs and benefits of legalizing the use of currently illicit drugs has been revived. This paper attempts to inform this debate by providing some evidence on the effects of illicit drug prices and legal sanctions for drug possession and sale on youth drug use. Data on cocaine and marijuana use by high school seniors are taken from the 1982 and 1989 Monitoring the Future surveys. Site-specific data on cocaine prices and legal sanctions for the possession and sale, manufacture or distribution of cocaine and marijuana are added to the survey data. The results indicate that youth cocaine demand is sensitive to price, with average past year and past month cocaine demand elasticities of -1.28 and -1.43, respectively. In addition, the estimates suggest that increased sanctions for the possession of cocaine and marijuana have a negative and statistically significant impact on youth cocaine and marijuana use. However, the magnitude of these estimates implies that very large increases in the monetary fines that can be imposed for first offense possession would be necessary to achieve meaningful reductions in use. Finally, sanctions for the sale, manufacture or distribution of cocaine and marijuana were found to have little impact on youth cocaine and marijuana use.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 6411.

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Date of creation: Feb 1998
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Publication status: published relationship to a non-chapter. This should not happen. Please contact NBER.
Handle: RePEc:nbr:nberwo:6411

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  1. 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. [Downloadable!] (restricted)
  2. R. L. Pacula & M. Grossman & F. J. Chaloupka & P. M. O'Malley & L. Johnston & M. C. Farrelly, 2000. "Marijuana and Youth," NBER Working Papers 7703, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
    • Rosalie Liccardo Pacula & Michael Grossman & Frank J. Chaloupka & Patrick M. O’Malley & Lloyd D. Johnston & Matthew C. Farrelly, 2001. "Marijuana and Youth," NBER Chapters, in: Risky Behavior among Youths: An Economic Analysis, pages 271-326 National Bureau of Economic Research, Inc. [Downloadable!]
  3. Kenneth W. Clements & Xueyan Zhao, 2005. "Economic Aspects of Marijuana," Economics Discussion / Working Papers 05-28, The University of Western Australia, Department of Economics. [Downloadable!]
  4. Moreno-Sanchez, Rocio & Kraybill, David & Thompson, Stanley R., 2002. "An Economic Analysis Of Coca Eradication Policy In Colombia," 2002 Annual meeting, July 28-31, Long Beach, CA 19833, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
  5. Jeff DeSimone & Matthew C. Farrelly, . "Price and Enforcement Effects on Cocaine and Marijuana Demand," Working Papers 0101, East Carolina University, Department of Economics. [Downloadable!]
    Other versions:
  6. Jeffrey DeSimone, 1999. "Illegal Drug Use and Labor Supply," Working Papers 9906, East Carolina University, Department of Economics. [Downloadable!]
  7. Michael Grossman, 2004. "Individual Behaviors and Substance Use: The Role of Price," NBER Working Papers 10948, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  8. J. Williams, 2004. "The effects of price and policy on marijuana use: what can be learned from the Australian experience?," Health Economics, John Wiley & Sons, Ltd., vol. 13(2), pages 123-137. [Downloadable!]
  9. Andrew M. Jones & José M. Labeaga, 2003. "Individual heterogeneity and censoring in panel data estimates of tobacco expenditure," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 18(2), pages 157-177. [Downloadable!]
  10. Suryadipta Roy, 2007. "Are Illegal Drugs Inferior Goods in the US?," Atlantic Economic Journal, International Atlantic Economic Society, vol. 35(3), pages 303-314, September. [Downloadable!] (restricted)
  11. Horowitz, Joel L., 2000. "Should the Dea's Stride Data Be Used for Economic Analyses of Markets for Illegal Drugs?," Working Papers 00-02, University of Iowa, Department of Economics. [Downloadable!]
  12. Ilyana Kuziemko & Steven D. Levitt, 2001. "An Empirical Analysis of Imprisoning Drug Offenders," NBER Working Papers 8489, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  13. Dhaval Dave, 2004. "The Effects of Cocaine and Heroin Prices on Drug-Related Emergency Department Visits," NBER Working Papers 10619, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  14. Pinka Chatterji & Sara Markowitz, 2000. "The Impact of Maternal Alcohol and Illicit Drug Use on Children's Behavior Problems: Evidence from the Children of the National Longitudinal Survey..," NBER Working Papers 7692, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  15. Sheng-Wen Chang & N. Edward Coulson & Ping Wang, 2002. "Optimal Drug Policy in Low-Income Neighborhoods," NBER Working Papers 9248, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  16. Stephen Pudney, 2001. "Keeping off the Grass? An Econometric Model of Cannabis Consumption by Young People in Britain," Discussion Papers in Economics 02/9, Department of Economics, University of Leicester, revised Mar 2002. [Downloadable!]
  17. Daniel Mejía & Carlos E. Posada, 2007. "Cocaine Production and Trafficking: What do we know?," BORRADORES DE ECONOMIA 003955, BANCO DE LA REPÚBLICA. [Downloadable!]
    Other versions:
  18. Jeff DeSimone, 2002. "Determinants of Drug Injection Behavior: Economic Factors, HIV Injection Risk and Needle Exchange Programs," NBER Working Papers 9350, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  19. Bretteville-Jensen,A.L. & Biorn,E., 2001. "Estimating addicts' price response of heroin : a panel data approach based on a re-interviewed sample," Memorandum 08/2001, Oslo University, Department of Economics. [Downloadable!]
  20. Sara Markowitz, 2000. "An Economic Analysis of Alcohol, Drugs, and Violent Crime in the National Crime Victimization Survey," NBER Working Papers 7982, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  21. Jeffrey DeSimone, 1999. "The Effect of Cocaine Prices on Crime," Working Papers 9907, East Carolina University, Department of Economics. [Downloadable!]
    Other versions:
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