The paper considers the problem of a firm that, while producing a standard product, has the option to introduce an innovative product. The innovative product competes with the standard product and will therefore reduce revenues of the standard product. A distinction is made between innovative...

Extreme price dispersion is a hallmark of illegal drug markets, and this apparent contradiction to the law of one price has long puzzled drug market economists. We propose a novel explanation for this dispersion: the coupling of dealers' unwillingness to hold inventory with dealers' imperfect...

Abstract We study delays in capital accumulation models. Our contribution is threefold. First, we identify a class of models that can be transformed into standard optimal control models without delay. Second, in the single state versions of these models the state trajectory is monotonic in the...

Since the end of the seventies Skiba points have been studied in infinite time optimal control problems with multiple steady states. At such a Skiba point the decision maker is indifferent between choosing trajectories that approach different steady states. This paper extends this theory towards...

Cost-of-illness (COI) studies seemingly provide a solid foundation for quantifying the potential benefits of illicit drug policy interventions that reduce drug use at the population level. However, their usefulness is severely limited. In this paper, we suggest several improvements to substance...

In 2001, use of the STRIDE data base for the purposes of analyzing drug prices and the impact of public policies on drug markets came under serious attack by the National Research Council (Manski et al., 2001; Horowitz, 2001). While some of the criticisms raised by the committee were valid, many of...

Purpose This study applies the concept of restrictive deterrence to a sample of drug market offenders. In particular, we assess the influence of behavioral changes post-arrest on time to rearrest.Methods The sample consists of arrest data on all drug offences in South Australia from the start of...