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A Search-Theoretic Model of the Retail Market for Illegal Drugs

Author

Listed:
  • R. Pacula

    (RAND)

  • N. Persico

    (NYU)

  • M. Galenianos

    (Penn State)

Abstract

We intend to use this model to investigate whether, for instance, increasing police activity makes occasional users more or less likely to consume: on the one hand searching in the market is more dangerous, but on the other the competitive pressure on the sellers increases because of increased search activity, thus reducing prices. Furthermore, we hope to examine how price dispersion affects behavior in the market, over and above the effect of average prices.

Suggested Citation

  • R. Pacula & N. Persico & M. Galenianos, 2007. "A Search-Theoretic Model of the Retail Market for Illegal Drugs," 2007 Meeting Papers 197, Society for Economic Dynamics.
    • Handle: RePEc:red:sed007:197
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    Cited by:

    1. Bryan Engelhardt & Mark R. Kurt & Philip M. Polgreen, 2013. "Sexually Transmitted Infections With Semi‐Anonymous Matching," Health Economics, John Wiley & Sons, Ltd., vol. 22(11), pages 1295-1317, November.
    2. Engelhardt Bryan, 2010. "Criminal Associations with Bargaining and Build Frictions," Review of Law & Economics, De Gruyter, vol. 6(2), pages 303-323, December.

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