37. Illicit drug prices are related to level of drug addiction

By Tom O'Connell

It shouldn't be astounding news that the cost of illicit drugs has a lot to do with their popularity. But it's good to be reminded of obvious realities sometimes.

Nearly a decade ago, Dr. James Jekel, Professor of Public Health at Yale School of Medicine, announced that the spread of cocaine was linked to modern marketing methods. He said the crack cocaine epidemic in the Bahamas began within months of a drastic drop in cocaine's street price. A large increase in the supply had led to the price reduction.

He said, "Cocaine pushers saw their profits declining, so they made a concerted effort to push the highly and rapidly addictive freebase. Soon, all you could get in the way of cocaine on the streets of Nassau and the rest of the Bahamas was the freebase form."

The pushers could keep prices low because of a new "cheap and simple method of making crack," he explained. So the new do-it-yourself chemical production technique and the new marketing strategy combined to create a rapidly expanding group of cocaine addicts. The addicts in turn increased demand, and that's what the pushers hoped for.

As we know, the epidemic spread from the Bahamas to the U.S. and ravaged the country for many years. Then, as predicted by experts, when the dangers of cocaine use escalated, there was a switch to heroin, which has been steadily growing in popularity.

Recent research on the economics of the drug scene has been coordinated for Harvard Medical School by Raymond Hyatt, M.S., who has passed on to me the results of a study of the price and purity of cocaine, and the impact on emergency room visits, deaths, and drug use among people arrested.

The introduction to the study points out that the demand for alcohol and tobacco, and the health consequences of using them, shows a decrease when prices increase. Does the same thing happen with cocaine? The research notes that as the price for a pure gram of cocaine increases, drug users either pay more for the same amount or pay the same price for a smaller amount. And when the price decreases, the opposite happens.

When emergency room visits for cocaine-related problems increased from 1986 to 1989, then declined in 1990, and went up again in 1991, the trends followed the price fluctuations of cocaine on the streets of America. The same thing happened with arrestees testing positive for cocaine, and medical examiner reports on cocaine-related deaths.

The research concludes: "Cocaine use increases as the standardized price of cocaine falls and decreases as the standardized price rises." The point stressed in the research is: "The demand for cocaine is sensitive to its price." And this thorough research is an excellent reminder that marketing trends should not be overlooked as an important factor in the prevalence of specific addictions. We can't afford to overlook the obvious.

Does this mean we'll solve addiction problems by increasing prices? No, because when prices rise, addicts simply shift to other more available drugs. But awareness of the connection between drug prices and epidemics can help with prevention and treatment.

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