The economics of the illicit drugs-for-guns trade and growth

Lim, K.Y. ORCID: 0000-0003-1978-176X and Morris, D. ORCID: 0000-0001-9268-1293, 2020. The economics of the illicit drugs-for-guns trade and growth. Economic Modelling, 91, pp. 218-232. ISSN 0264-9993

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Ever since US president Richard Nixon declared a war on drugs in 1971, different drug control policies have been implemented in both consumer and producer countries. These include policies ranging from crop eradication to an interdiction of drug shipments to outright legalization of drug possession. In this paper we develop a novel endogenous growth framework that unifies international trade, drugs control and accounts for consumers’ rational addiction and optimizing choice of drug consumption. Our results emphatically show that a one size-fits-all approach to drug control is ineffective. We show that there exists a production - consumption growth trade-off around the policy priority not previously documented in the literature. Moreover, we show that in the absence of a fundamental change to drug demand, drug control policies are unlikely to reduce illicit trades for drugs and guns in the long run.

Item Type: Journal article
Publication Title: Economic Modelling
Creators: Lim, K.Y. and Morris, D.
Publisher: Elsevier
Date: September 2020
Volume: 91
ISSN: 0264-9993
S0264999320300213Publisher Item Identifier
Divisions: Schools > Nottingham Business School
Record created by: Linda Sullivan
Date Added: 06 Jul 2020 12:59
Last Modified: 23 Jun 2021 03:00

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