SIMULATION OF ADAPTIVE RESPONSE - A MODEL OF DRUG INTERDICTION

This paper presents a Monte Carlo simulation of the smuggling and interdiction of illicit drugs that explicitly allows for adaptation across routes and modes. The model is used to examine several issues surrounding the interdiction of cocaine shipments into the U.S. It suggests that back-of-the-envelope estimates of interdiction's effectiveness may be overly optimistic if they neglect the existence of a backstop technology (smuggling small shipments over land), the concavity of smugglers' costs as a function of the fraction of all routes on which the interdiction rate is increased, and the fact that not all smuggling costs are caused by interdiction. When one considers these factors, it appears that only under truly exceptional circumstances would one expect increasing interdiction to have a substantial impact on U.S. cocaine consumption.