Government Policy Toward Illegal Drugs: An Economist's Perspective

This paper explains how economists think about government policy toward illegal drugs. The economics perspective suggests that rational discussion of drug policy must address two distinct questions. The first is whether policy should attempt to reduce drug use; the second is whether prohibition is a good method of reducing drug use, should that goal be desirable. Economic reasoning suggests that reducing drug use is not necessarily a compelling goal for policy, although it does not rule out that perspective. Economic reasoning also suggests that prohibition is an inefficient method for reducing drug use – assuming that goal is taken as given – except under conditions that do not appear consistent with existing evidence.Economic