Wednesday, May 07, 2008

Illicit Drug Prices

I was looking through a document put out by the National Drug Intelligence Center (US Dept. of Justice) titled: National Illicit Drug Prices. [It was emailed to me so I don’t have a link]

It really struck me how this report discusses this stuff similarly to other commodities. It is a commodity based business after all. It includes information on the prices of various illicit drugs at the wholesale-level, midlevel and at the retail end of the business. It talks about how some sporadic shortages and their concomitant price increases may be caused “by Columbian suppliers’ shifting cocaine from U.S. drug markets to European markets…taking advantage of the stronger euro…”

Also driving the cost of the drugs is the issue of purity at the wholesale level. Increased purity at the wholesale level in turn increases the amount of midlevel and retail drug that can be derived per kilo of wholesale-level drug. “The price of a kilogram of heroin in Chicago decreased…(related to)…heroin purity recently increased…ending a nearly 10-year decline…increasing availability of the drug.”

I am not sure that we view the drug trade as much as a commodity business as it really is, with various market pressures. This isn’t a discussion of right or wrong, Lord knows we see the heavy toll of these illicit substances, but just an observation as my thoughts were provoked by the publication.

It would be interesting to see drug-related deaths and other drug-related problems and crimes plotted against these price fluctuations.

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