Opioid Use, Health and Crime: Insights from a Rapid Reduction in Heroin Supply
In 2001, a large and sustained supply shock halted a heroin epidemic in Australia. We use outpatient drug treatment records to identify individuals who accounted for nearly half of opioid overdoses prior to the shock, and examine how the reduced supply of heroin affected their health and criminal activity over the next eight years. Initially, the gains from fewer overdose deaths are offset by individuals substituting to other drugs and committing more violent crime, including homicides. Most adverse effects dissipate after one year, and are followed by further decreases in deaths and a large reduction in property crime. Our results demonstrate that reducing the supply of illicit opioids can lead to meaningful longer-term improvements, even when the short-term effects are ambiguous.
We thank Mark Anderson, Scott Cunningham, Monica Deza, Mirko Draca, Bill Evans, Mario Fiorini, Seth Freedman, Mike Grossman, Alex Hollinsworth, Thomas Lemieux, Ethan Lieber, Jens Ludwig, Mike Mueller-Smith, Rosalie Pacula, Chris Ruhm, Kosali Simon, Peter Siminski, Rosanna Smart, Cody Tuttle, and Don Weatherburn for helpful comments as well as conference/seminar participants at NBER Summer Institute Health Economics Program 2018, Chicago/LSE Conference on the Economics of Crime and Justice 2019, the Texas Economics of Crime Workshop 2019, Clemson University, Indiana University at Bloomington, Indiana University-Purdue University at Indianapolis, San Diego State University, University of Adelaide, University of British Columbia, University of Manitoba, University of Melbourne, University of Technology Sydney, and University of Victoria. We thank the NSW Center for Health Record Linkage and the NSW Bureau of Crime Statistics and Research for data linkages and support. Moore gratefully acknowledges financial support from an Australian Research Council Discovery Early Career Research Award (DE170100608). The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.