Journal of Political Economy · 1995 · 147 citations · 0 references
Social SciencesEconomicsPharmaceutical PolicyEconomic HistoryPricing TheoryPublic EconomicsDemand AnalysisDemand TheoryPharmaceutical EconomicsPrice ElasticityPrice HistoryDrug Market DynamicsDrug Market StructuresMonopoly Demand EstimationOpioid Market DynamicsOpium RegulationPrice Elasticity ModelingRetail Drug Markets
At the beginning of the twentieth century the Dutch government controlled the opium market in the Dutch East Indies, a state monopoly known as the opiumregie. The study aims to estimate price elasticities of opium consumption using data from the opiumregie. It uses information gathered during the opiumregie to estimate these elasticities. Short‑term price elasticities of opium use are about –0.7, while long‑term elasticities are about –1.0.
At the beginning of this century the Dutch government controlled the opium market in the Dutch East Indies--nowadays Indonesia--for several decades. This state monopoly was called the opiumregie. Using information gathered during the opiumregie, this paper estimates price elasticities of opium consumption. It appears that short-term price elasticities of opium use are about -0.7. Long-term price elasticities are about -1.0.