Price and Enforcement Effects on Cocaine and Marijuana Demand

Jeffrey DeSimone and Matthew C. Farrelly ()
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Matthew C. Farrelly: Tobacco Use Research Program, Center for Interdisciplinary Substance Abuse Research, Research Triangle Institute, Research Triangle Park, NC 27709.

Economic Inquiry, 2003, vol. 41, issue 1, 98-115

Abstract: This article estimates equations for past year cocaine and marijuana use among adult and juvenile respondents of the 1990--97 National Household Surveys on Drug Abuse. Unlike most previous studies, we control for the monetary price of marijuana, probabilities of arrest for marijuana and cocaine possession, and state fixed effects. Results indicate that cocaine prices are inversely related to adult cocaine and marijuana demand but are unrelated to juvenile drug demand, marijuana price effects are always statistically insignificant, estimated price effects are inflated when state effects are omitted, and increases in each arrest probability diminish both types of drug use. Copyright 2003, Oxford University Press.

Date: 2003
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Persistent link: https://EconPapers.repec.org/RePEc:oup:ecinqu:v:41:y:2003:i:1:p:98-115

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