Download - Marijuana Controlled Substances 1. Marijuana in the news Dispensaries back country plots 2
MarijuanaControlled Substances
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Marijuana in the news
Dispensaries
back country plots
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Policy IssuesEnforcement Costs
Helicopters
Ecological damage to public forest lands
Danger to hikers etc. from armed & ruthless growers
Enforcement benefits
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Canadian Enforcement Costs
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UK Harm Scale
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Maricopa Highway, State 33
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Pine Mountain Ridge Road
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Reyes Campground Looking North
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Questions About Crime What are the Social Policy Options Towards
Victimless Crimes?education problem prevention
health problem cure for addicts and abusers
fiscal problem control use through taxes
law enforcement problem focus on demand?
users
focus on supply?distributors
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Market Analysis
Compare and contrastfree market
enforcement
fiscal policy excise tax as a control device
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Market Analysis concepts
market supply marginal cost of production: the additional cost of
one more unit cost of production equals the sum of marginal costs revenue = price * quantity sold
market demand price some consumers are willing to pay expenditure = price * quantity bought consumer surplus: a measure of welfare for those
consumers willing to pay above the market price
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Market Analysis Concepts
supply and demand determines the market price
the marginal cost of production = the marginal value of consumers
the quantity demanded equals the quantity supplied
profit = revenue - cost of productionprofit, or producer’s surplus, is a welfare measure
total welfare benefit = consumer’s surplus + producer’s surplus
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Quantity Produced
Cost ofProduction
Marginal Costof Production
MarginalCost
Quantity
Market SupplyMarket Supply
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Market DemandMarket Demand
MarketPrice, PM
Quantity Demanded, QM
RevenueR = PM QM
Market Demand
ConsumerSurplus
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MarketPrice, PM
Quantity Demandedand Produced, QM
Demand
Supply
Cost ofProductionTrapezoid
Profit =Revenue -Cost
ConsumerSurplusTriangle
Market Supply and DemandMarket Supply and Demand
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Enforcement Policy: Search, Confiscate, ResaleEnforcement Policy: Search, Confiscate, Resale
a
PM
PM
2 a
2 PM
FreeMarketSupply
Search, Confiscate,Resale: Supply
Quantity Produced
Price,MarginalCost
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a
2 a
FreeMarketSupply
Search, Confiscate,Resale: Supply
Quantity Producedand Demanded, QS, C, R
Price,MarginalCost
Demand
FreeMarketPrice, PFM
Search,ConfiscateandResalePrice, PS, C, R
Enforcement Policy: Search, Confiscate, ResaleEnforcement Policy: Search, Confiscate, Resale
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Enforcement Policy: Search, Confiscate, BurnEnforcement Policy: Search, Confiscate, Burn
a
PM
PM
2 a
2 PM
FreeMarketSupply
Search, Confiscate,Resale: Supply
Quantity Produced
Price,MarginalCost
Search, Confiscate, Burn: Supply
QM
QM / 2
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a
2 a
FreeMarketSupply
Search, Confiscate,Resale: Supply
Quantity Producedand Demanded, QS, C, B
Price,MarginalCost
Demand
FreeMarketPrice, PFM
Search,ConfiscateandBurnPrice, PS, C, B
Search, Confiscate, Burn :Supply
Enforcement Policy: Search, Confiscate, BurnEnforcement Policy: Search, Confiscate, Burn
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Fiscal Policy: 50% Excise Tax, Government Keeps the RevenueFiscal Policy: 50% Excise Tax, Government Keeps the Revenue
a
PM
PM
2 a
2 PM
FreeMarketSupply
50 % Excise TaxSupply
Quantity Produced
Price,MarginalCost
Tax/unit = 0.5 Price/unitRevenue - Tax = $20,0002 Plots*P - 2 Plots*T = $20,0002(P - T) = $20,0002(P - 0.5P) = $20,000P = $20,000
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Fiscal Policy: 50% Excise Tax, Government Keeps the RevenueFiscal Policy: 50% Excise Tax, Government Keeps the Revenue
a
PM
PM
2 a
2 PM
FreeMarketSupply
50 % Excise TaxSupply
Quantity Produced
Price,MarginalCost
Tax/unit = 0.5 Price/unitRevenue - Tax = $20,0002 Plots*P - 2 Plots*T = $20,0002(P - T) = $20,0002(P - 0.5P) = $20,000P = $20,000
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a
2 a
FreeMarketSupply
50 % Excise TaxSupply
Quantity Producedand Demanded, Q
Price,MarginalCost
Demand
FreeMarketPrice, PFM
Price, Pwith a 50%Excise Taxand BuyProgram
50 % Excise Tax and BuyProgramSupply
Fiscal Policy: 50% ExciseTax, Use Revenue to Buy MarijuanaFiscal Policy: 50% ExciseTax, Use Revenue to Buy Marijuana
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Fiscal Policyan excise tax is cheaper
than enforcement & more effective
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Questions About Crime What are the Social Policy Options Towards
Victimless Crimes?education problem prevention
health problem cure for addicts and abusers
fiscal problem control use through taxes
law enforcement problem focus on demand?
users
focus on supply?distributors
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Education Let an informed public make a choice
An individual would weigh the benefits against the costs
If the benefit/cost ratio exceeds one smoke drink
Could impose costs on others driving under the influence second hand smoke
Protection of Minors blandishments of advertising influence of peers
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Health
Treat substance abuseNeed to identify the abusers many citizens are not covered under health plans
Difficult to cure addicts
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Fiscal Policy
Use excise taxes, a tax per unit, to control demand
tax per pack of cigarettes
tax per bottle of gin
Policy moderates rather than eliminates uselacks the moral suasion of a law prohibiting use
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Law Enforcement Control demand?
hard to keep tabs on numerous users
loss of respect for the law people like to party
Control supply?at home search and destroy policies have a low success
rate
abroad interdiction of supply has low success rate we export our enforcement problem to:
producing countries, e.g. Bolivia, Peru, Colombia
Trans-shipment countries, e.g. Mexico35
What are the Tradeoffs Among Policy Options?
ReviewINTRODUCTION (facts or trends, graphics, themes)
Current policy issues. What did we discuss?
History of California Prisons. Have they always been overcrowded?
History of California Offense Rates. Have they always been high?
The Economic Approach to Crime Control (graphics)
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Outline for Today: 09/22/2011
Syllabus: course details
Syllabus: Assignments by Lecture Number
Current Criminal Justice Policy Issues
Trends in California imprisonment and crime levels
Questions about crime trends and imprisonment trends
The Economics of Crime Control
3838
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.00
.01
.02
.03
.04
55 60 65 70 75 80 85 90 95 00 05 10
CAINDXPC
.000
.001
.002
.003
.004
.005
55 60 65 70 75 80 85 90 95 00 05 10
CAPRPC
California Index Offenses per Capita and California Prisoners per Capita, 1952-2010
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The Economics of Crime Control
Objective: minimize the sum of damages to victims and expenditures on the criminal justice system
Damages to victims = loss rate* offenses, or in symbols r*of
Expenditures on the criminal justice system, abbreviated CJS, for law enforcement, trials (district attorneys, public defenders, judges) and operating jails and prisons
The Graphics of Total Cost, TC
TC = r*OF + E
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$
E on CJS
Total Cost (E)
Minimum Cost
Optimal Expenditure
Economic Paradigm1. Choose objective
e. g. minimize sum ofdamages to victims plus expenditures, E, on CJS
2. Describe states of the world (options for choice)
Total cost curve (E)
3. Choose the best option
What Have We LearnedEven if crime is controllable, the optimal level of crime ( and damages to victims) is not zero
There comes a point where spending more on crime control, i.e. the CJS, costs more than is saved by reducing damages to victims, and this is where total costs start to rise above their minimum
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What If Crime, Or Some Types of Crime, are Not
Controllable
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The Graphics of Total Cost, TC
TC = r*OF + E
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$
E on CJS
r*OF(E)
45 degrees
Total Cost (E)
Minimum TotalCost is noExpenditure onCJS, E=0
0
optimum
The Graphics of Total Cost, TC
TC = r*OF + E
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$
E on CJS
r*OF(E)
45 degrees
Total Cost (E)Minimum TotalCost is noExpenditure onCJS, E=0
0
optimum
What Did We Learn From Prohibition, 1919-1933?
The argument was: misuse or abuse of alcohol can have bad effects
Drunken husbands beat their wives
Drunken mothers mistreat their children
But the majority of people did not want to give up alcohol
Following the passage of the Volstead Act in 1919, we witnessed rum-runners, speakeasies, people making beer and bathtub gin
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ReviewTHE IMPACT OF CRIME ON SOCIETY
How much FBI Index Crime is There?
What are the Four Index Crimes Against Property?
What are the two main effects of crime on social welfare? (graphics)
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Outline and Issues 9/27/2011
Course logistics: gauchospace
Criminal Justice System (CJS) & economic paradigm: where do the values (prices) come from to evaluate the states (outcomes) of the CJS?
How much crime is there? How do we know?
Crime has two effects: Redistribution of welfare from the victim to the
perpetrator Opportunity cost or waste of resources for defense
How is Crime Measured
Victimization Surveys of Households U S Dept of Justice, Bureau of Justice Statistics,
Criminal Victimization
Citizen (Victim) Reports to Police U S Dept of Justice, FBI, Uniform Crime Reports
A Theme for this Course
Criminal Justice System is in crisis. Courts told former Governor Schwarzenegger to find
housing for prisoners or release them early City and County jails are overflowing and a revolving
door policy is in effect. Repeat offenders clog the system
Not enough judges and prosecutors
It Has Not Always Been This Way
The Criminal Justice System had been relatively stable in the decade after World War II
What happened? That is the story of this course.
We will review the history of criminal justice in the 60-plus years since WW II.
We will suggest policies that will help turn things around now. In brief, what is needed is triage, i.e. to use scarce resources that will improve public safety the most.
Questions about crimeQuestions about crime
Is crime a real problem or a media induced problem?
Is crime an economic problem?
Are we getting our money’s worth for the dollars we spend on police, jails, and prisons?
Taking CrimesTaking Crimes
Robbery
Burglary
Auto Theft
Larceny
Two Perspectives On Crime
No Problem
It’s Bad
Victim’s Income
Thief’sIncome
$6,000
$6,000
Income Distribution
$12,000Total or Social Income Line:Thief’s + Victim’s Income
$12,000
Income Redistribution$9,000
$3,000 $11,000
$1,000 socialcost of defense
$11,000
CrimeGeneration
Offense Rate,Damages toVictims
Fear
Media
Defense
Private Public Politicians
We over-react to crime and we do not triage
Questions about the Operation of CJS
If crime is going down, why are we devoting more resources to its control?
If drug offenders are mostly non-violent, why do we send them to state prison instead of rehabilitation?
Bad effects from taking crimes
Bad effects from taking crimes
Victim has less incentive to be productive
Victim has more incentive to spend time and money on defense
Analogous to war: guns vs. butter
What is society going to produce? defense against crime? or goods and services?
ReviewJOBS AND CRIME
Policy issue: Arizona gun laws
Question: What did we learn from the seriousness survey?
Question: What is the most important economic perspective about economic conditions and crime?
Long run: investment in human capital ( education & job experience)
Tradeoff between leisure & income (graphics) , i.e TIME IS MONEY
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Today 9/29/2011Policy Issue: Gun Laws (Arizona)
Seriousness ratings for ten behaviorsHow much would you pay to prevent your bike being stolen?
Experimental issue: Do economic conditions cause crime?
How to study for this course!
How to study for this course!
Lecture course: go to lecturesNo section and no TA
Look at outline slide at the beginning of each lecture with the major points and a summary slide at the end of each PowerPoint with the major points
Be familiar with the graphical analysis in the class notes & the PowerPoints
Look at last Winter’s (2011) midterm for clues
Read (listen, look, Google) the news and keep up with criminal justice system stories
The Economy and Crime
Is crime affected by the business cycle?
Do economic factors cause crime?
Outline Seriousness Survey
What can we learn from the survey?
Crime File Victims Jobs and Crime
Jobs and Crime Why do some people get involved with crime?
SERIOUSNESS SURVEY
RATE THE SERIOUSNESS OF EACH OF THE FOLLOWING BEHAVIORS ON A SCALE FROM ZERO( LEAST SERIOUS) TO TEN( MOST SERIOUS):
MEDIAN W11 F111. HOMICIDE _10 10__2. MASS POISONING ( e.g. TYLENOL)_ 9 9__ 3. FORCIBLE RAPE _ 9 _10_4. ARSON: SET FIRE TO A GARAGE _ 7 __75. SELLING HEROIN _ 7 _7_6. AUTO THEFT _ 6 _6_7. EMBEZZLEMENT OF $1,000 _ 5 __58. PROSTITUTE IN A HOUSE OF PROSTITUTION _ 4 __39. POSSESSION OF MARIJUANA _ 2 __110. SNIFFING GLUE _ 2 __1
Median seriousness Scores Fall 2011 and Winter 2011
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1
Forcible rape
homicide
Poisoning
Arson, Selling heroin
Auto Theft
embezzlement
Prostitute
, Pot Possession, Sniff ing glue
y = 0.8367x + 1.1633
R2 = 0.9882
0
1
2
3
4
5
6
7
8
9
10
0 2 4 6 8 10 12
Fall 2011
Win
ter
2011
Consistency from year to year
Consistency from year to year
ConclusionsConsistency from year to year
Triage is possible: we can separate the more serious behaviors from the less serious behaviors
Distribution of Homicide Scores in F 2011
Histogram
0 0 0 0 0 0 0 2 03
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0
10
20
30
40
50
0 1 2 3 4 5 6 7 8 9 10
Seriousness score
Fre
qu
en
cy
Three ? Views on Pot, Fall 2011
Score: 0-2, 35Score: 3-5, 11Score: 6&7, 224, a score of 1, would carry a majority vote, 32, a score of 2, would carry a 2/3 vote
Histogram
7
20
85
3 31 1 0 0 0
0
5
10
15
20
25
0 1 2 3 4 5 6 7 8 9 10
Seriousness Scores
Fre
qu
en
cy
The more serious the behavior, the less disagreement about
policy. Fall 2011
Mass Poisoning
Embezzlement
Arson
Auto Thef t
Prostitute
Pot Possession
Selling Heroin
Sniffi ng Glue
Forcible rape
Homicide
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
2
0 2 4 6 8 10 12
Seriousness Score
Months Served in California Vs. Fall 2011 Seriousness
Possession Vehicle Theft
Arsont
Rape
Homicide
y = 9.445e0.1906x
R2 = 0.693
0
20
40
60
80
100
120
0 2 4 6 8 10 12
Seriousness Scores
Mo
nth
s S
erv
ed
Months Served in CA Prison Vs. F ’11 Seriousness Scores
Months Served in CA Prison Vs. F ’11 Seriousness Scores
Questions About Crime
Does the Business Cycle Affect Crime Rates?
Does an Individual’s Life Cycle Affect Crime Rates?
Why do some people live socially unproductive lives?
Two Points About Economic Conditions
and Crime Relationship of Crime to the Business Cycle
Short Run: Business Cycle Is Phil Cook wrong? California: the misery index and crime
misery index = unemployment rate + inflation rate
Relationship of Crime to the Life Cycle Long Run Investment in Education Role of the Family
24 hours0 hoursLeisure(learning)
Earnings
$480
$ 0
high
low value
slope of the iso-preference curve through the 24 hour endowment is the lowest wage at which you are willing to work
$96
dropout is unwilling to work for $4/hr
REVIEWDETERRENCE AND THE DEATH PENALTY
Policy issue: The Death of the Death Penalty Newsweek, CA
The Arguments: Pro Vs. Anti, NIJ video
Debate: Is the death penalty a deterrent?
Homicide and executions, CA compared to other statespp
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Outline 10/04/2011 The Death Penalty
Arguments Philosophical and moral (lexicographic ordering) Practical: Is it a deterrent?
Impact on the criminal justice system: Detention (prison building era) dominates
Operation of the Death Penalty
Homicide and Executions
Crime Generation
Crime Control
OffenseRate PerCapita
ExpectedCost ofPunishment
Schematic of the Criminal Justice System
Causes ?
(detention,deterrence)
Expenditures
Weak Link
Questions About CrimeDoes the Expected Severity of Punishment Deter Crime?
expected severity = probability of punishment * severity of punishment
e.g. in LA County: 0.005*death penalty
Why Do We Keep Building Prisons at Great Expense to Warehouse Convicts?
Doesn’t deterrence work?
Do we have to rely on detention?
Controversy About the Death Penalty
Death penalty is the most severe sentence. Does it deter crime?
Opponents of the death penalty say no.Their evidence? Critiques of studies that indicate the death penalty is a deterrent.
Why are so few murderers who receive the death sentence executed in California? Death sentence appeases the proponents. Few executions appeases the opponents.
Executions in the US 1930-2007
http://www.ojp.usdoj.gov/bjs
Peak to Peak: About 65 years
Bureau of Justice Statistics
Peak to Peak: 50 years
Policy Impact of Opponents to the Death
Penalty As an instrument for crime control, deterrence has been a casualty of the argument about the death penalty. The argument: if the death penalty does not
deter murderers, then deterrence must not work as a control.
As a consequence, society relies more and more on detention for crime control. Society builds more and more prisons.
Questions About Statistical Studies of
Deterrence Do we know enough about the factors that cause
crime? Can we find variables that will control for variation
in crime generation?
We have better measures for the factors that control crime than for the factors that cause crime. Unknown variation in crime generation may mask
the effects of crime control.
Source: Report to the Nation on Crime and Justice
Expect
Get
REVIEWSTRATEGIES TO ESTIMATE DETERRENCE
What is the critique of econometric studies of deterrence?
What is the evidence for deterrence?
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Schematic Model
Causes
Homicide
Controls:Imprisonment rateClearance ratio
Empirical Study of Certainty, Severity, & Causality
Empirical Study of Certainty, Severity, & Causality
-.8
-.4
.0
.4
.8
4
6
8
10
12
1970 1975 1980 1985 1990 1995 2000 2005
Residual Actual Fitted
Murder Rate Regressed on Clearance Ratio, Imprisonment Rate & Suicide Rate
Evidence Against the Death Penalty Being a
DeterrentContiguous States
Maine: no death penalty Vermont: death penalty New Hampshire: death penalty
Little Variation in the Homicide Rate Source: Study by Thorsten Sellin in Hugo Bedau,
The Death Penalty in America
Isaac Ehrlich Study of the Death Penalty:
1933-1969Homicide Rate Per Capita Control Variables
probability of arrest probability of conviction given charged Probability of execution given conviction
Causal Variables labor force participation rate unemployment rate percent population aged 14-24 years permanent income trend
911 call(characteristics of household Participants unknown)
Random Assignment
code blue code gold
patrol responds patrol responds
settles the household settles the household
verbally warn the husband take the husband to jail for the night
That’s all folks!