Harold Pollack
is a public health policy researcher at the University of Chicago's
School of Social Service Administration, where he is faculty chair of
the Center for Health Administration Studies. He is a regular
contributor to The Treatment.
It's rare to get actual evidence regarding the effectiveness and impact of supply-side enforcement measures to disrupt illicit drug markets. (It's even rarer for policymakers to request such evidence--even as they demand all sorts of answers regarding the impact and cost-effectiveness of prevention and treatment interventions.) The current American Economic Review contains a nice article by Carlos Dobkin and Nancy Nicosia [behind a firewall] that provides a welcome addition to this generally data-free debate.
In mid-1995, the government successfully disrupted the methamphetamine market by clamping down on a key precursor chemical called ephedrine. Examining California data, Dobkin and Nicosia reported a tripling of meth prices, with a corresponding decline in street drug purity. Meth-related drug treatment admissions decreased by 35 percent. Felony arrests for meth possession and sale dropped by half. Oddly, however, there was little sign of an accompanying decline in crime.
Overall, Dobkin and Nicosia document that disrupting methamphetamine supply brought useful short-run effects. Their findings are rather similar to the benefits reported by researchers who studied Australia's heroin drought, whereby that country's unique geography allowed law enforcement to choke off supply much more significantly than we have achieved in the U.S.
Sadly, the benefits achieved by disrupting California's methamphetamine market proved rather fleeting. Within four months, meth prices pretty much returned to pre-intervention level. Within about 18 months, the key public health outcomes returned to what they were before. There are just too many ways for the market to re-equilibrate and for suppliers to find new manufacturing processes that evade law enforcement innovations.
Ironically, the above results may be most pertinent to alcohol policy--where our ability to raise prices is much greater, and where we could achieve large health and crime gains by raising excise taxes. Some smart economists have proposed exactly this policy, but that is another story....
--Harold Pollack