Economic Analysis of Illicit Drugs

Course Calendar Description Economic analysis of illicit drugs, Including effects on demand, supply, prices and other market outcomes. Market structure, drug pricing, and price discrimination in comparison to the legal drug market. Public policy issues such as legalization, costs of addiction, enforcement and punishment. Synopsis Economic analysis is applied to selected aspects of illicit drugs. The emphasis is on the economics specifically, so we will not be taking or experimenting with any illicit drugs during the course, but all the analysis will be applied to the institutional details of illicit drugs.  The study of the unique economics of illicit drugs is relatively new but growing rapidly. Consequently there is no consensus about what should be taught in a course on illicit drugs, it is a learning experience for the instructor as well as the students, and the course will change from year to year. The topics covered and their sources will almost surely be modified as the course evolves throughout the term.

There are no prerequisites for this course, however a close reading of http://en.wikipedia.org/wiki/Economics can be helpful prior to starting this course. Sakai Sakai/Isaak can be accessed from the Brock Homepage (www.brocku.ca) by selecting “Web Services” and then Isaak/Sakai. At the login screen you will type in your Badger username (ab00yz) and password. All students have one Badger ID and password they use to access any computer lab on campus, Brock Badger Email, the Brock Portal and Sakai. If you have not set up your Badger ID and password, please fill out a Computer accounts agreement using Student Self Service. If you require assistance, go to the computer commons, where a lab advisor will be able to help you. Course Communications Course Content: Course Content:

Topic 1: Some Economic Basics⦁ thinking at the margins, including opportunity costs, to best allocate scarce resources⦁ basic economic concepts, demand and supply, price elasticity Topic 2: Drug Supply and Criminal Organizations⦁ illicit distribution of the flow of drugs⦁ criminal organization Topic 3: Addictive Consumption⦁ price and consumption⦁ the instability of demand for drugs Topic 4: Economics of Prohibition⦁ prohibition and crime⦁ law and economics Topic 5: Optimal Public Intervention⦁ optimal level of consumption⦁ economics of crime Topic 6: Enforcement⦁ enforcement on both demand and supply sideTopic 7: The Use of Performance-Enhancing Drugs in Professional Sports References: There is no assigned textbook for this course. Course content will be taken mainly from the following sources, which are available either physically from the Brock University library or through online resources. Because this course is new, the most important information on each topic will be provided during lectures, rather than assigned readings.

Kopp, Pierre. Political Economy of Illicit Drugs. Rutledge Press, 2004.Becker, G. (1968) “Crime and Punishment: An Economic Approach”, Journal of Political Economy, 76, 2, 169-217Becker, G. And Murphy, K. (1988) ‘A Theory of Rational Addiction’, Journal of Political Economy, August, 96, 675-700Friedman, M. (1991) ‘The War We are Losing’, in M.B. Krauss and E.P. Lazear (eds) Searching for Alternatives: Drug Control Policy in the United States, Stanford, CA: Hoover Institution Press,pp. 53-67Evaluation:Mid-term test* – June 10 (on Sakai) 35% Assignment due – July 2(on Sakai) 15%Final exam (on Sakai) (TBD) 50%* If for whatever valid reason the midterm examination is missed, the corresponding weight will be transferred to the final examination. It is your responsibility to inform Indra Hardeen of your absence prior to the midterm examination taking place. You must provide your documentation no later than1 week after the midterm. A late assignment will receive a one mark per day deduction, for every day it is late.

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