Macroeconomic Aspects of Substance Abuse: Diffusion, Productivity and Optimal Control

Amnon Levy () and Frank Neri ()
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Frank Neri: University of Wollongong, http://www.uow.edu.au/commerce/econ/who/index.html

Economics Working Papers from School of Economics, University of Wollongong, NSW, Australia

Abstract: This paper deals dynamically with macroeconomic aspects of widespread substance abuse with a reference to illicit drugs as an example. Substance-abuse impedes the productivity of the labour force and subsequently economic growth. The labour force is divided into non-using and therefore fully productive workers, a number of whom are employed by the government in drug-control activities, and drug users who are only partially productive. An efficient management of the nation's portfolio of workers is taken to be the trajectory of drug-control that maximises the present value of the stream of disposable national incomes.

Keywords: Substance abuse; labour productivity; national income; optimal control (search for similar items in EconPapers)
JEL-codes: I12 J21 J24 D90 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-hea
Date: 2004
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Related works:
Journal Article: MACROECONOMIC ASPECTS OF SUBSTANCE ABUSE: DIFFUSION, PRODUCTIVITY AND OPTIMAL CONTROL (2006)
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