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MACROECONOMIC ASPECTS OF SUBSTANCE ABUSE: DIFFUSION, PRODUCTIVITY AND OPTIMAL CONTROL

Published online by Cambridge University Press:  24 March 2006

AMNON LEVY ,
FRANK NERI  and
DIETER GRASS
AMNON LEVY
Affiliation:
City College of New York, City University of New York and University of Wollongong
FRANK NERI
Affiliation:
University of Wollongong
DIETER GRASS
Affiliation:
Vienna University of Technology
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Abstract

This paper deals with macroeconomic aspects of widespread substance abuse with a reference to illicit drugs as an example. Substance abuse impedes the productivity of the labor force and reduces economic growth. Workers are either nonusers and therefore fully productive, a number of whom are employed by the government in drug-control activities, or users who are only partially productive. Efficient management of the nation's portfolio of workers involves eradicating drug use when initial user numbers are lower than a critical level, but allows user numbers to rise to, and be accommodated at, a stationary level when initial user numbers exceed a critical level.

Keywords

Substance AbuseLabor ProductivityNational IncomeOptimal Control
Type
ARTICLES
Information
Macroeconomic Dynamics , Volume 10 , Issue 2 , April 2006 , pp. 145 - 164
Copyright
© 2006 Cambridge University Press

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