Drug Use and Drug Policy

Early in the twentieth century the Dutch East Indies (present-day Indonesia) had a government monopoly on the import, refining, and retailing of opium. There were regional differences in opium policy ranging from areas with prohibition to areas where opium use was hardly restricted. We analyze 1930 data from administrative files and find that a strict opium policy was implemented in areas in which opium use among indigenous users was low anyway. We find some evidence that a strict opium policy had a negative effect on drug use by Chinese.