David R. Henderson  

The Portuguese Puzzle: Decriminalization of Drugs and Drug Usage

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In 2009, Glenn Greenwald wrote, for the Cato Institute, a study of the effects of drug decriminalization in Portugal. Among his findings were that drug usage actually decreased among various populations.

Greenwald writes:

In fact, for those two critical groups of youth (13-15 years and 16-18 years), prevalence rates have declined for virtually every substance since decriminalization (see Figures 4 and 5).

For some older age groups (beginning with 19- to 24-year-olds), there has been a slight to mild increase in drug usage, generally from 2001 to 2006, including a small rise in the use of psychoactive substances for the 15-24 age group, and a more substantial increase in the same age group for illicit substances generally.


I was quite surprised.

The decrease among the very young did not completely surprise me. When I give talks on the drug war, I point out that there are two contrary effects on drug usage of reducing the penalties for using illegal drugs. The reduced penalties cause the price to be lower, thus moving people down a given demand curve and increasing the amount consumed. But the simply fact of decriminalization makes illegal drugs less of a "forbidden fruit," causing a downward shift in the demand curve. I point out that we don't know a priori which effect dominates, but that my gut feel is that the price effect dominates, leading to more consumption. I do point out, though, that the forbidden fruit effect is likely to be stronger for younger people and I illustrate by singing a few bars from a song my mother taught me about not putting "beans in my ears." That is why Greenwald's data showing that usage by the young declined is not totally surprising.

But the fact that usage increased only a little among 19 to 24 year olds did surprise me. I would have expected a much bigger effect of price.

I should note that I'm using the word "price" in a more-inclusive way than the usual. The price includes not just the cash outlay per unit but also the legal risk that comes with buying and using. Decriminalization would cause this legal risk to fall substantially, thus reducing the price.

But what if much of illegal drug use is a response to isolation? Then imposing harsh penalties can actually shift the demand curve higher because criminalization results in isolation. In that case, decriminalization would shift the demand curve lower not just for the youngest but for everyone.

That's the point of a recent article at the Huffington Post. Of course the author does not put it in terms of demand curves and movements along demand curves. But that's what's going on.

An excerpt from Johann Hari, "The Likely Cause of Addiction Has Been Discovered, and It Is Not What You Think:"

One of the ways this theory [that drugs cause addiction] was first established is through rat experiments--ones that were injected into the American psyche in the 1980s, in a famous advert by the Partnership for a Drug-Free America. You may remember it. The experiment is simple. Put a rat in a cage, alone, with two water bottles. One is just water. The other is water laced with heroin or cocaine. Almost every time you run this experiment, the rat will become obsessed with the drugged water, and keep coming back for more and more, until it kills itself.

The advert explains: "Only one drug is so addictive, nine out of ten laboratory rats will use it. And use it. And use it. Until dead. It's called cocaine. And it can do the same thing to you."

But in the 1970s, a professor of Psychology in Vancouver called Bruce Alexander noticed something odd about this experiment. The rat is put in the cage all alone. It has nothing to do but take the drugs. What would happen, he wondered, if we tried this differently? So Professor Alexander built Rat Park. It is a lush cage where the rats would have colored balls and the best rat-food and tunnels to scamper down and plenty of friends: everything a rat about town could want. What, Alexander wanted to know, will happen then?

In Rat Park, all the rats obviously tried both water bottles, because they didn't know what was in them. But what happened next was startling.

The rats with good lives didn't like the drugged water. They mostly shunned it, consuming less than a quarter of the drugs the isolated rats used. None of them died. While all the rats who were alone and unhappy became heavy users, none of the rats who had a happy environment did.


OK, so that was about rats. What about humans? Hari continues:
At first, I thought this was merely a quirk of rats, until I discovered that there was--at the same time as the Rat Park experiment--a helpful human equivalent taking place. It was called the Vietnam War. Time magazine reported using heroin was "as common as chewing gum" among U.S. soldiers, and there is solid evidence to back this up: some 20 percent of U.S. soldiers had become addicted to heroin there, according to a study published in the Archives of General Psychiatry. Many people were understandably terrified; they believed a huge number of addicts were about to head home when the war ended.

But in fact some 95 percent of the addicted soldiers--according to the same study--simply stopped. Very few had rehab. They shifted from a terrifying cage back to a pleasant one, so didn't want the drug any more.


The bottom line: Legalizing drugs could well reduce the demand for all age groups. The Portuguese puzzle is not so puzzling.

HT to Todd Zywicki.


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CATEGORIES: Regulation




COMMENTS (16 to date)

In Hawaii, juvenile arrests for drug possession and drug promotion FALL in summer, when school is NOT in session. Adult arrests for drug promotion fall in summer, when school is not in session. Adult arrests for promotion rise in summer, when school is not in session.
A statistician in the office of the Attorney General, State of Hawaii, gave me these charts.
In summer, people age 6-18 buy less drugs, the dealers go out of business, and the supply shifts to the adults.

Sorry. Adult arrests for possession RISE in summer. The juvenile drug market collapses in summer, juvenile and adult dealers leave the market, and the supply shifts to the adults.
It would be interesting to see how many of those summertime adult buyers are tourists.

I've always thought it interesting that for many teenagers it is easier to get marijuana than cigarettes or alcohol. The reason shouldn't be surprising. Black market sellers are already breaking the law, so sellers are less concerned about selling to minors. Legal sellers of cigarettes or alcohol have more to lose by selling to minors.

Teens can buy alcohol, marijuana and tobacco easily enough. Drugs which adults may legally buy, those adults may (illegally) sell or give to teens, and the State sets lower legal penalties on sale of alcohol and tobacco to minors than on the sale of marijuana to minors.

As a former Math teacher, I'd rather my students used heroin or meth than marijuana, since marijuana gums up the calculator. I speak from experience.

Back to our topic: the seasonal pattern of teen drug arrests supports David Henderson's rat conjecture.

(Henderson): "The bottom line: Legalizing drugs could well reduce the demand for all age groups. The Portuguese puzzle is not so puzzling."

My bottom line: repealing compulsory school attendance statutes could well reduce the demand for drugs among all age groups. The homeschool puzzle is not so puzzling.
Conventionally schooled, 17%.
Religious homeschooled: 3%.
Secular homeschoollers: 15.8%

Tiago writes:

Great post.

Matt Moore writes:

[Comment removed for being ad hominem. Please address the substantive points in the post and the discussion thread.--Econlib Ed.]

mbka writes:

The work on rats and how societal isolation creates a powerful incentive to use opiates is not new or a surprise. The neuroscientist Jaak Panksepp has a lot to say on this. There's a lot of evidence that social isolation first creates a panic response and then depression. Panksepp calls this the PANIC (uppercase on purpose) system of the brain. Social deprivation symptoms are mildered by drugs such as heroin. Panksepp identifies another system he calls SEEKING. This system gives rats (and people "drive" to seek out novelty and generally stay and feel alive. This system also goes down as a consequence of depression / social isolation. Cocaine stimulates this SEEKING system and arguable that's why it is so "popular" with the creative class or anyone else who likes the feeling of being curious or just active.

References:
On social isolation, e.g.:
Feeling the pain of social loss

Broader view of Jaak Panksepp views on the brain:
The Archaeology of Mind: Neuroevolutionary Origins of Human Emotions

Tom Davies writes:

There is a literature around this, not all supporting Alexander https://news.ycombinator.com/item?id=7743089

Floccina writes:
But what if much of illegal drug use is a response to isolation?

This does not match with my observation of friends, though marriage seemed to reduce use. People seemed to most often use together.

Current writes:

"But in fact some 95 percent of the addicted soldiers--according to the same study--simply stopped. Very few had rehab."

As Tim Worstall pointed out on his blog, this is not a new idea. Stanton Peele has been arguing it for decades.

NZ writes:

A fine blog entry, David Henderson! Well done.

I think there are powerful cultural nuances at work, but they are below the level of these studies. Consider for example how patterns in drug use vary not just by age group but by race and class. Some age/race/class groups are more responsive to changes in the law (and to changes in cost/price/risk) than others, and that response is not always easily predictable.

I'm increasingly convinced that beyond our genes, the lion's share of influence on our behavioral decisions has to do with tribal identity. Without understanding the microculture of young Portugese people, I'd be very hesitant to make any further assertions based on those findings. I'm even more hesitant to try to apply those findings to the US.

Ricardo Cruz writes:

NZ, I would be surprised if there is more difference between the "microculture" in California, Arizona, New York or Lisbon (Portugal).

Portuguese kids watch MTV, listen to POP music, eat at McDonalds, play GTA and all that stuff. They are as Americanized as kids in Arizona have been Californiazed. We drive cars everywhere, etc etc, only we speak Portuguese. But everybody here speaks English as well because unlike most of Europe, movies are not dubbed here (only subtitled). You probably wouldn't miss much if you were to come here.

If you do not think you can learn anything from a study from another state, from another city or from another street, then it is a fair point. David Hume thought you could not deduce that "rocks always dropped" because maybe in another place they do not. And in economics things are even more complex. But if you think you can learn something from a study from an American state, then for sure you can learn something from a study from Portugal.

NZ writes:

@Ricardo Cruz:

By microculture I wasn't thinking so much about what people consume as about what they consider cool, ironic, off-limits, etc. A joke that everyone laughs at for one reason in one place may be laughed at for another reason in another place, but that subtle difference doesn't show up when you just measure whether people laugh at the joke.

It's not that I don't think you learn anything from studies that are done in other places, it's that I think you have to be very careful in your expectations of what would happen if you applied the lessons locally.

Chris Wegener writes:

Re: the Vietnam Heroin addiction

Another important factoid is that the heroin in Vietnam that the soldiers had access to was essentially pure and cheap.When I was there a vital of heroin cost five dollars and was good for several days.

Once back in America the soldiers would not have been able to find any comparable product nor a source. This would make it much more likely that they could got.

David R. Henderson writes:

@Chris Wegener,
Really good point. It hadn’t occurred to me that heroin would be so cheap in Vietnam. For an economist to forget about taking into account price, in a post in which I talk about price, is almost unforgivable. Thanks.

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