The Business of Narcotics : do Outlaw Motorcycle Gangs affect young men’s experience of narcotics?

In this thesis, Outlaw Motorcycle Gangs are used to measure the effects of organized crime on young men’s experience of narcotics. The study relies on panel data for Swedish counties stretching over the period 1995-2005, using results from conscript surveys to determine young men’s experience of narcotics. When applying a fixed effect model, the results show that Outlaw Motorcycle Gangs actually have a negative effect on the experience of narcotics among 18-year-old Swedish men. However, when lagging the time of establishment for the gangs one year, positive estimates are derived for individuals ever used, or been offered to use illicit narcotics. These findings are only significant on a ten percent level, but the results could implicate that it may take some time for the Outlaw Motorcycle Gangs to penetrate new markets; finding a profitable way of adapting to the new market conditions. Due to possible problems with endogeneity, it’s difficult to derive any definitive conclusions regarding the true effects of Outlaw Motorcycle Gangs. It’s possible that the location of a new OMG is partially determined by the use of narcotics, wherefore the results are to be taken with some caution