Why Are Illegal Drugs Stronger Than They Used to Be?

Illegal drugs are a lot stronger than they
used to be. For example, the average potency of marijuana, its THC content, has increased
significantly over the past 40 years. What economists call the potency effect sheds some
light on the trend. Let’s say you want to buy some weed. You can
get a dime bag of weak, low-potency marijuana for a third the price of the strong stuff.
That means that for every bag of really potent ganja you buy, you’re giving up the chance
to smoke three whole dime bags of the weak stuff. In the poetic parlance of economics,
the opportunity cost of smoking strong pot is pretty high. Since you’re on a budget,
you usually opt for the weaker weed. Now let’s consider the effects of prohibition.
Since Richard Nixon declared the war on drugs in 1973, the penalties for possessing and
dealing marijuana have gone up. The chances of getting caught may be low, but the threat
of a steep fine or jail time effectively increases the price of both high- and low-potency hash.
But notice, because of this, the cost of potent weed relative to weak weed has actually declined.
Now each bag of strong pot might only cost twice as much as weak pot. So the higher cost
is less imposing. In fact, you might think that as long as you are taking the risk you
may as well get the more potent drug. This is the potency effect in action. The larger
the penalty or the greater the chance of getting caught the smaller is the relative price difference
between strong and weak drugs. That means that laws prohibiting drugs can actually increase
the proportion of stronger drugs being used, which helps explain why potency has risen
as the war on drugs has escalated. Potency effects drive the supply side of the
market, too. As legal penalties for drug trafficking have become more severe, cartels and dealers
have had to expend more resources evading law enforcement. This means concentrated,
high-potency drugs like cocaine become even more attractive to sell since high-value amounts
are easier to transport. So dealers have an added incentive to push harder drugs. This
is why hard liquor displaced beer during alcohol prohibition in the 1920s and why cocaine use
spiked in the 1970s. Of course, not everyone can afford high-end drugs or alcohol. So just
as gangsters during alcohol prohibition would dilute whisky with water, drug dealers in
the 1970s began cutting smuggled cocaine with baking soda in order to create crack. The
resulting crack-cocaine epidemic ravaged inner city communities in the 1980s. Potency effects shape markets of all sorts.
They explain why couples with children who need to pay for a babysitter in order to enjoy
a night out tend to eat at fancier restaurants than couples without children. They also explain
why grocers in New York City respond to high transportation costs by offering top notch
produce. Potency effects are just one among many forces that make markets so complex.
Drug markets are no different. So when public policy alters the incentives people face,
it can lead to unintended and even disastrous consequences.

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100 Responses

  1. rkb100100 says:

    So the more illegal we make street drugs, the better they get! Instead of legalizing, all you potheads should be advocating a mandatory death penalty for possession!

  2. Nicholas Stillman says:

    He's a little off on the weed part. In reality, you don't often have the opportunity to shop around for strong weed or the weaker kind. You buy whatever the dealer happens to be selling. Dealers come and go; they run out, lose connections, or quit selling out of fear. So you get a mixed variety of quality.

  3. Suprdave123 says:

    No Dude, if there was a mandatory death penalty the only thing you could find would be meth and H.

  4. hybridmcgee says:

    Finally someone on this channel who doesn't come off as a total revisionist ass-clown(for now). A little bookish and naive on details but I think we can handle it.

    Regardless, he makes a very compelling case, which is probably the first time for that to happen in your cult without being debunked 5 minutes later. Congratulations! The senior members should give an award, but not publicly because that would ruin the image of being objectivist by replacing it with a hint of honesty. Fuck you.

  5. Matthew says:

    What if there are many dealers operating in the same area? Isn't that largely the case.

  6. tartredarrow says:

    Yeah, if you only know one guy and aren't a frequent user, you may not seek out other sellers. But regular users often know many people who sell different quality weed.

  7. 403.DeadUnderling says:

    I bet half of you are high on drugs right lol 😛

  8. tartredarrow says:

    Learn Liberty is a "baby steps" project designed to get people to start thinking in different ways. If you want challenging philosophical discussion, you'll need to log onto a philosophy show or attend seminars. Many different organizations hold conferences and seminars.

  9. robinsss says:

    this is a bunch of bologna

    pot got stronger because pot smokers wanted it to be stronger

    and they had the cultivation skills to make it stronger
    ( hydroponics, cloning)


    the people who made this video are clueless

  10. hybridmcgee says:

    Thank you for the suggestions. Most of this channel is blind-folded "baby steps" in reverse and I call it out in hopes to prevent misleading people who aren't already indoctrinated.

    Many individuals follow this stuff. It's unfortunate that this kind of subtle influence only confuses them by displacing their intuition, wisdom and values with fallacies presented as cute and clever marketing propaganda. Normally there's an incentive and this is one of the rare exceptions. This is bait-and-switch.

  11. Philly Cheese Take says:

    When government uses it's efforts to stop a service, the providers become more adept at facilitating that service.
    When government uses it's efforts to sell a service, the providers become less adept at facilitating that service.
    Interesting, isn't it?

  12. Recovering_Californian says:

    "The War on Drugs" brings in HUGE sums of money for the cartel, for governments, for dealers, for the police agencies charged with enforcing drug law, and for prison guard unions. There is ZERO incentive to change these laws.

  13. lsk464 says:

    I think this is a bit over simplified.

  14. ekklesiast says:

    So government prohibition increases the rewards of doing drug business, thus attracting more people to make and sell drugs. Isn't it amazing?
    Could it be that war on drugs is lobbied by draglords, in order to keep profits high?

  15. Mark Anthony says:

    me too.

  16. Token says:

    When the Statist make something "illegal", there's some motive and reasoning that in one way or another benefits them. Making drugs illegal empowers those who foresee wealth by illegal trade, sure they may get caught however majority of risk takers don't get caught… If legalized drugs would be much cheaper for consumers so who is really looking out for whom with all of this illegal legislation?

  17. piotrekmarek80 says:

    not everybody do drugs 😉

  18. H. Guderian says:

    Seems fairly spot on. Added risk raised cost making it more profitable to develop and produce more potent product, an effect that applies to many markets.

  19. piotrekmarek80 says:

    and why pot smokers wanted it stronger?

  20. FM von Manstein says:

    Legalize weed, regulate it, tax it, sell it like booze and cigarettes – profit. Execute anyone dealing hard drugs.

  21. Jeff Spivak says:

    wat tha fuck is wrong wit you? your gonna execute people for non-voilent crime?

  22. Shahe says:

    Thanks, Obama!

  23. American Infidel says:

    In my neck of the woods, a 'dime bag' which is the equivalent of an 1/8th of an ounce, or 3 grams, is roughly 5-6 times cheaper than the good stuff. Cheap stuff is 10 bucks per dime good stuff if 50-60 per dime.

  24. robinsss says:

    so the "high" would be more intense

  25. McCarthy331 says:

    someone needs to make a T shirt:
    Premium Quality!
    since 1970

  26. tartredarrow says:

    Can you clarify? I'd like to hear your rebuttal to this video or another LearnLiberty video you maybe take particular issue with.

  27. zaidster111 says:

    thats what i thought too.

  28. Miles Trevonne Mauesby says:

    "Dime bag" "Purple Haze" How do you guys know this? I'm surprised you didn't refer to cocaine as white girl

  29. Nate P says:

    Sounds like you're being ripped off . . .that's concentrate prices.

  30. H. Guderian says:

    and such techniques were sped along by the extra demand created by the artificial scarcity pressure caused by such anti-drug laws. Its a part of the puzzle. I think saying 'clueless' is a bit much.

  31. EDman00x says:

    So… legalize it.

  32. Sky hound says:

    I heard there's this new meth that turns people into crocodiles. I can't imagine why anyone would want to be a crocodile. It would be so boring setting around in the river all day. I could see how someone who didn't like their life might be interested though. Just because being a crocodile seems easier than being human. That being said, I'm not sure if you retain your human intelligence. If so, we might be looking at another form of intelligent species to spring forth upon the earth.

  33. Great White7 says:

    lol, it does not turn you into a croc, it eats away your muscles and fucks you up.

  34. robinsss says:

    "and such techniques were sped along by the extra demand created by the artificial scarcity pressure caused by such anti-drug laws. Its a part of the puzzle

    I don't see any connection between what he said and the price of marijuana but if you believe it then you have a right to your belief

  35. Christina Geraci says:

    Not sure if the "unintended consequences" are really unintended…

  36. omNomios says:

    What's the title of the music?

  37. Zachary E. says:

    3rd law of Demand!!!

  38. Beldizar says:

    Horray Adam is now doing Learn Liberty videos!

  39. mitino aiken says:

    hmmm i tend to disagree or at least all the people that i know that grow it want to make it more potent to get higher.

  40. maeth says:

    Excellent video

  41. Kevin32001 says:

    You're simply wrong. Violence occurs from drug dealing because it's an illegal trade. Thus, the territories from this illegal trade are fought for, and there are victims. If drugs were legalized, and done in a way which made stuff like DUIs have very harsh penalties, and healthcare isn't provided for abusers, then it could be regulated, taxed, and sold, just like alcohol. When it comes to drugs, both selling and consuming is a personal choice. It being illegal is what causes violent crimes.

  42. Anthony says:

    no one who is serious is saying that drugs are a victim less crime, in fact they are saying the opposite, it is the fact that they are illegal that is causing the crimes to begin with not the other way around. In every single place drugs have become legal violent crime and in fact everything other than DUI's has gone down in most cases by close to half. You are arguing against the wrong thing and it would do you good to not just read propaganda made to keep drug companies money.

  43. American Infidel says:

    That is what everybody here has paid for the past 15 years. Real weed, not some dude telling me he has purp but in really its Mexican dirt. Maybe you are thinking about wholesale prices like a qp broken up.. which obviously we have more value for the price.

  44. American Infidel says:

    damn autocorrect….

  45. Benjamin Abruzzo says:

    So, let me get this straight: More laws against drugs makes the quality go up because of the cost of risk relative to price. Fewer laws make quality go up because of ease of competition.

    I don't see the option to make drugs go away.

  46. Tjitze de Boer says:

    I see.
    To save the video game industry we have to ban them! >:D

  47. album says:

    There isn't an option to make drugs go away. Once it is introduced it is out there in everyone's conscious.

  48. 123Logic says:

    It's called Krokodil and it's a by product of prohibition. Heroin is prohibited in Russia (where the drug originated) so people have made a home made version using codeine, paint thinner and a few other things. It rots their skin, bones and veins and they usually only live for 2-3 years. Vice did a big video on it.

  49. ekklesiast says:

    In Soviet Union private manufacturing of almost any goods was illegal in accordance with marxist dogmas. People got jailed and even executed for making and selling shirts and pants (literally). In effect, the risks and the deficit made underground production highly profitable and the illegality brought it to the hands of organized crime. So, even textile business will generate violence and murders if declared illegal by state.

  50. v4rmru171 says:

    I regret searching it up. Ugh..

  51. MrJarth says:

    if you want SUPER addictive games.

  52. Alston Ng says:

    Did he even blink?

  53. Mikey G says:

    supply and demand Mr. Abruzzo, supply and demand…

  54. Nicholas Stillman says:

    I quit a long time ago, but generally the more you hunt around, the more likely you will be noticed by the police. Also, it's a huge hassle trying to make new connections when the dealers are all understandably paranoid about trusting new buyers.

  55. andrew black says:

    Crack is not simply "cut" with baking soda, it's chemical form is changed via an acid-base reaction. Cutting is the process of diluting in order to increase profits, fundamentally different from producing crack.

    Chemistry student

  56. Alexandre Pinho says:

    Fewer laws reduce the need to make harder drugs because people already buy the soft ones. Plus if we keep doing this people will die so fast that it's more profitable to sell them drugs that kill them more slowly.

  57. Bettertext says:

    It only goes away if demand goes away… good look with that one.

  58. Aaron .Bednarski says:

    This guy probably votes too..

  59. Aaron .Bednarski says:

    Although you are right (chemist as well).. It still is the same effect (as in generating more drug with less) as cutting it.

  60. jlateralus21 says:

    You obviously need to study more economics. Taxing marijuana will not get rif of the black market. It will still be there because it will be cheaper to buy illegally.

  61. animebest099 says:

    Yes, I agree with him. Criminals should die 🙂

  62. Sarge Rho says:

    …Jump in front of a Bus, please.

  63. animebest099 says:

    Why? Are you suggesting any criminals that aren't political criminals should deserve to live? I think not, but then again, there's no use arguing with liberal losers.

  64. Ferrule Bezel says:

    How is this anything more than a specific case of seigniorage being reflected in the price?

  65. hybridmcgee says:

    People are lured into libertarian ideals only to find that everything should be left up to the states and religious fanatics anyway, and those things should never be questioned. That's what's paramount other than so-called free-market ideals which are only exercised in favor of the largest entities. There's no legitimate concern for real businesses or ordinary people because it still results in reducing their representation and creating an atmosphere of fear and uncertainty.

  66. Sarge Rho says:

    I'm saying that there is no crime heinous enough to warrant death.

  67. tartredarrow says:

    Depends on your flavor of libertarianism. /watch?v=fwxBj5OfeGM

    It sounds to me what you're frustrated with is the Tea Party. Yes it is conservative and takes many libertarian-ish positions, but it lacks an academic/principled understanding and thus religiosity and other problems contaminate their advocacy.

    I agree that many conservatives attempt to use regulations to favor big business, but this is not a libertarian position. It's a neoconservative position.

  68. Corey Snow says:

    Thanks, Republicans! Thanks, Nixon and Nancy! /sarcasm

  69. FortNikitaBullion says:

    What if we make the penalty of drug use proportional to its potency? Would this effect still hold?

  70. YlSHAE says:

    Same logic applies to guns

  71. Bill Pigg says:

    Drugs. who gives a shit.

  72. BroodjeEend says:

    I feel like this is overthinking things. Couldn't it be that marijuana got stronger because knowledge about the plant and growing methods got better through the years? I live in the Netherlands, and weed is not illegal here. It got stronger nonetheless. 

  73. IMissLiberty says:

    If I were selling pot, and I could go to jail for having more than an ounce, it would be more cost-effective to make sure the ounce was worth more.  Why risk all that for an impotent ounce?  It's not just the prohibition that raises the potency, but the relatively higher penalty of having 3 ounces of weak pot vs. the lower penalty for 1 ounce of strong pot.

  74. GerritJanL says:

    Doesn't really explain how in The Netherlands – where there is no war on drugs – the marihuana also got more potent. And this the homegrown stuff, not imported from the US or something… 

  75. xcvsdxvsx says:

    i just realized this same potency effect applies to the effects of minimum wage.

  76. Nick Bennett says:

    Very intelligent observations. It's about time the statue of liberty start walking over to kick our congress out of office.. or circus or whatever is going on.

  77. tm2jetfire says:

    High potency marijuana contributes to better health. Extracts mean no extraneous plant matter being combusted. Alternative methods of consumption such as vaporizers and edibles eliminate smoke from the whole equation.

  78. Lal Gulabi says:

    these guys are always saying shit. some regluation is not a bad thing.  A TOTAL 100% FREE MARKET IS BAD FOR COMMON MAN as it would give cooperation power and they would manipulate the markets. EVERY ACTION HAS NEGATIVE AND POSITIVE CONSEQUENCES. these guys just point out the negative and dont point out the positve effect which out weigh the negatives. how is this free, good press.

  79. Lal Gulabi says:

    EVERY THING IS GOOD IN MODERATION AND OTHER WISE BAD SAME GOES FOR LIBERTY AND CAPATALISMIS GOOD IN MODERATION. if you have 100% liberty that is not that good neither is 50 % liberty. we should not say that its our right to take drugs and make fights rather individual rights and responsbilities shold be debated rather that just liberty as a whole. it should be debated with postive and negative side of story being told unlike what always happen on this channel.

  80. Bryan Westbrook says:

    Well done.  Excellent video.

  81. RayZ fox says:

    1 ounce of cheep weed will put you in jail for the same amount time as 1 ounce of potent weed.

  82. Don Stacy says:

    I was unaware of the interesting relationship between the potency effect and expensive dinner for a couple after babysitter for the children.

  83. Shawn Jones says:

    Great, more people who don't understand drugs talking of drugs. This means "it has gotten stronger" is likely a lie on many levels. There is more than THC and the degradation process should increase its THC content while decreasing the other cannibinoids,cannibinols, etc. Thus meaning marijuana has different levels of THC according to its curing time and age among other factors. In maturing time longer maturing (to an extent)= bigger yield= likely more THC=more profit from the yield alone .  A handful of humans are intelligent so they can make plants better. Any farmer knows this.  None of this can be argued though because the testing is mostly govt ran and the news is 98% govt ran, so the debate is near 100% govt ran. They control the debate in a manner to just distract people into winding corridors that lead to dead ends.

  84. Shawn Jones says:

    More importantly we shouldn't be discussing why to legalize marijuana we should be discussing who goes to prison and what bank accts get seized for making this illegal for them to profit off of their constant illegal wars

  85. ProffersorKritzkrieg says:

    thanks for the information , this really helped!!!

  86. iiREDNARCii says:

    Weed is better because we just wanna get high. I wont even smoke dirt weed, so i would never care about how much i could buy.

    If you bought an asprin, that didnt get rid of your headache, would you buy more, or, would you buy a better brand?

  87. TheNade says:

    lol, Like every video on this channel, they almost got it right then twisted the subject to suit their predetermined view.

    Drugs are better QUALITY because people have gained knowledge of how to produce them with higher quality. Weed is better now than in the 70s because we have the technology and a better understanding of the science of botany to grow a better product. The reasons listed in this video are the side effects of this, not the reason itself.

  88. furyofbongos says:

    "Unintended consequences". It is naive to think that a politician has ever had a good intention towards a citizen. They act in their own political self interest. Politicians don't give a rat's ass about the citizens they rule over. Never have and never will.

  89. bza069 says:

    but if a child tries pot, won't they go out the next day and get hooked on heroin & turn into a zombie???  JK.  i propose legalizing everything…especially freedom to choose what you consume. 

  90. See Canon says:

    Being addicted to a plant; now that is what is considered intelligent.

  91. Ret Pally says:

    Does this guy know my weed man? He seems to have his price list XD

  92. Charles Hill says:

    Last time I checked a dime bag of cheap weed costs the same as a dime bag of good weed…

  93. lrdazure says:

     this guy is an idiot.. just not sure what angle. the strength has always been crap to high. the person deciding to grow "stronger" cannabis vs "weaker" based on risk vs reward has nothing to do with the fucking plant. 

  94. velvet01able says:

    This is bullshit. Pot THC has gone thru the roof because you can grow it in your basement instead of having to import it from God knows where, and you can smoke the skunk weed instead of homegrown junk.  If anything, you are getting more dope for your buck today due to the increased THC.  Pot prices around me have stayed static, if not gone down. Who cares…all the potheads I know are basically bums, or functional bums. Let them toke away. The world needs ditch diggers. 

  95. Ed Waggoner Sr. says:

    Great insights.

  96. truther1000 says:

    The government of Canada is using your tax money to put out anti-marijuana ads. Their most recent television ad explains that drugs are now more potent than ever.
    Economist Adam Martin explains that this increase in potency is the government's fault. "Laws prohibiting drugs actually increase the proportion of stronger drugs being used"
     If drug potency is your concern, then ending the drug war should be your priority

  97. truther1000 says:

    Never believe anything the government says, always question them and their true motives, legalize pot and end the war on drugs, because we all know that the governments war on drugs has been the biggest failed war yet pushed by government

  98. Bob Edwards says:

    The Crack epidemic was in the late 80's early 90's and was a product of the CIA, not cartels. It was a two sided solution that provided funding for the Iran Contra scandal and the gentrification of black naborhoods of southeast LA. Look up project Pegasus for yourself. Economics is a pseudoscience at best! And in the words of JFK don't trust the "experts". Expert opinion is a fallacy.

  99. David says:

    This a bull shit. Natural marijuana hasn't changed it's "potency" at all. On the other hand, people who hybridized marijuana away from the natural plant have been successful in creating a unnatural so-called marijuana plants that have very high chemical deviance.

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