Department of Public Finance
National Chengchi University
No. 64, Sec. 2, Tz-nan Rd.
Taipei 116, Taiwan
NBER Working Papers and Publications
|October 2002||Optimal Drug Policy in Low-Income Neighborhoods|
with N. Edward Coulson, Ping Wang: w9248
Part of the debate over the control of drug activity in cities is concerned with the effectiveness of implementing demand- versus supply-side drug policies. This paper is motivated by the relative lack of research providing formal economic underpinning for the implementation of either policy. We construct a simple model of drug activity, in which the drug price and the distribution of population in a community are determined according to a career choice rule and a predetermined drug demand. Three potential government objectives are considered. We find that both demand- and supply-side policies have theoretical support under different community conditions. While the demand-side policy discourages active drug sellers, the supply-side policy has an additional drug-dealing replacement effect o...
Published: SHENG-WEN CHANG & N. EDWARD COULSON & PING WANG, 2016. "Optimal Drug Policy in Low-Income Neighborhoods," Journal of Public Economic Theory, vol 18(5), pages 726-751.