Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
961748 | Journal of Health Economics | 2006 | 23 Pages |
Abstract
This paper estimates the empirical relationship between cocaine and heroin prices and drug-related hospital ED admissions for 21 U.S. cities. These outcomes bypass some of the problems with self-reports and directly measure a component of healthcare costs associated with heavy drug usage. The price elasticity of the probability of a cocaine and heroin episode is estimated at â0.27 and â0.10, respectively. A 10% increase in prices can prevent 10,723 cocaine and heroin-related ED visits, with cost savings between $21 million and $47 million. These low magnitudes of the drug outcome-price response have implications for the cost-effectiveness of enforcement-driven price increases.
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Authors
Dhaval Dave,