IDEAS home Printed from https://ideas.repec.org/a/bpj/bejeap/v15y2015i4p1507-1548n3.html
   My bibliography  Save this article

Turf and Illegal Drug Market Competition between Gangs

Author

Listed:
  • Naranjo Alberto J.

    (Department of Economics, Universidad de La Sabana, Puente del Comun, Km 7, Chia 107 32, Colombia)

Abstract

Street-level illegal drug markets generate much of the violence and intimidation that local communities face nowadays. These markets are mainly driven by territorial gangs who finance their activities through the sale of drugs. Understanding how the existence of both turf and drug market competition may have unintended consequences of law enforcement policies on violence is the main contribution of the paper. We propose a two-stage game-theoretical model where two profit maximizing gangs compete in prices and invest in guns. We find that policies such as traditional or community policing can have different and unexpected effects on the level of violence.

Suggested Citation

  • Naranjo Alberto J., 2015. "Turf and Illegal Drug Market Competition between Gangs," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(4), pages 1507-1548, October.
    • Handle: RePEc:bpj:bejeap:v:15:y:2015:i:4:p:1507-1548:n:3
    DOI: 10.1515/bejeap-2013-0161
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/bejeap-2013-0161
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1515/bejeap-2013-0161?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Sylvaine Poret, 2001. "The Illicit Drug Market : Paradoxical Effects of Law Enforcement Policies," Working Papers 2001-02, Center for Research in Economics and Statistics.
    2. Adam Jacobsson & Alberto Naranjo, 2009. "Counter-intuitive effects of domestic law enforcement policies in the United States," Economics of Governance, Springer, vol. 10(4), pages 323-343, November.
    3. Fox, Kathleen A. & Lane, Jodi & Akers, Ronald L., 2010. "Do perceptions of neighborhood disorganization predict crime or victimization? An examination of gang member versus non-gang member jail inmates," Journal of Criminal Justice, Elsevier, vol. 38(4), pages 720-729, July.
    4. Naranjo, Alberto J., 2010. "Spillover effects of domestic law enforcement policies," International Review of Law and Economics, Elsevier, vol. 30(3), pages 265-275, September.
    5. Robert Burrus, 1999. "Do efforts to reduce the supply of illicit drugs increase turf war violence? a theoretical analysis," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 23(3), pages 226-234, September.
    6. Caulkins Jonathan P & Reuter Peter & Taylor Lowell J, 2006. "Can Supply Restrictions Lower Price? Violence, Drug Dealing and Positional Advantage," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(1), pages 1-20, January.
    7. Greg Shaffer & Z. John Zhang, 2000. "Pay to Switch or Pay to Stay: Preference‐Based Price Discrimination in Markets with Switching Costs," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 9(3), pages 397-424, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Flores, Daniel, 2016. "Violence and law enforcement in markets for illegal goods," International Review of Law and Economics, Elsevier, vol. 48(C), pages 77-87.
    2. Prieger James E. & Kulick Jonathan, 2015. "Violence in Illicit Markets: Unintended Consequences and the Search for Paradoxical Effects of Enforcement," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(3), pages 1263-1295, July.
    3. Caulkins, Jonathan P. & Reuter, Peter, 2006. "Illicit drug markets and economic irregularities," Socio-Economic Planning Sciences, Elsevier, vol. 40(1), pages 1-14, March.
    4. Faria João Ricardo & Mixon Franklin G. & Upadhyaya Ashish & Upadhyaya Kamal P., 2019. "Gang Rivalry and Crime: A Differential Game Approach," Review of Law & Economics, De Gruyter, vol. 15(2), pages 1-30, July.
    5. Manolis Galenianos & Rosalie Liccardo Pacula & Nicola Persico, 2012. "A Search-Theoretic Model of the Retail Market for Illicit Drugs," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 79(3), pages 1239-1269.
    6. Edward M. Shepard & Paul R. Blackely, 2010. "Economics of Crime and Drugs: Prohibition and Public Policies for Illicit Drug Control," Chapters, in: Bruce L. Benson & Paul R. Zimmerman (ed.), Handbook on the Economics of Crime, chapter 10, Edward Elgar Publishing.
    7. Jentzsch, Nicola & Sapi, Geza & Suleymanova, Irina, 2013. "Targeted pricing and customer data sharing among rivals," International Journal of Industrial Organization, Elsevier, vol. 31(2), pages 131-144.
    8. Naixin Zhu, 2023. "Dissertation on Applied Microeconomics of Freemium Pricing Strategies in Mobile App Market," Papers 2305.09479, arXiv.org.
    9. Bernard Caillaud & Romain de Nijs, 2011. "Strategic loyalty reward in dynamic price Discrimination," Working Papers halshs-00622291, HAL.
    10. Walter Beckert & Paolo Siciliani, 2018. "Protecting Vulnerable Consumers in "Switching Markets"," Birkbeck Working Papers in Economics and Finance 1808, Birkbeck, Department of Economics, Mathematics & Statistics.
    11. Sumit Shrivastav, 2021. "Price discrimination with imperfect consumer recognition," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2021-017, Indira Gandhi Institute of Development Research, Mumbai, India.
    12. Anindya Ghose & Ke‐Wei Huang, 2009. "Personalized Pricing and Quality Customization," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 18(4), pages 1095-1135, December.
    13. Stole, Lars A., 2007. "Price Discrimination and Competition," Handbook of Industrial Organization, in: Mark Armstrong & Robert Porter (ed.), Handbook of Industrial Organization, edition 1, volume 3, chapter 34, pages 2221-2299, Elsevier.
    14. Boxer, Paul & Kubik, Joanna & Ostermann, Michael & Veysey, Bonita, 2015. "Gang involvement moderates the effectiveness of evidence-based intervention for justice-involved youth," Children and Youth Services Review, Elsevier, vol. 52(C), pages 26-33.
    15. Irina Baye & Geza Sapi, 2020. "Consumer foresight, customer data, and investment in targeting technology," Scottish Journal of Political Economy, Scottish Economic Society, vol. 67(4), pages 363-386, September.
    16. Kutsal Dogan & Ernan Haruvy & Ram Rao, 2010. "Who should practice price discrimination using rebates in an asymmetric duopoly?," Quantitative Marketing and Economics (QME), Springer, vol. 8(1), pages 61-90, March.
    17. Asplund, Marcus & Eriksson, Rickard & Strand, Niklas, 2001. "Price Discrimination in Oligopoly: Evidence from Swedish Newspapers," SSE/EFI Working Paper Series in Economics and Finance 468, Stockholm School of Economics, revised 01 Jan 2007.
    18. Greg Shaffer & Z. John Zhang, 2002. "Competitive One-to-One Promotions," Management Science, INFORMS, vol. 48(9), pages 1143-1160, September.
    19. Sapi, Geza & Suleymanova, Irina, 2013. "Consumer flexibility, data quality and targeted pricing," DICE Discussion Papers 117, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    20. Ongena, Steven & Paraschiv, Florentina & Reite, Endre J., 2023. "Counteroffers and Price Discrimination in Mortgage Lending," Journal of Empirical Finance, Elsevier, vol. 74(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:bejeap:v:15:y:2015:i:4:p:1507-1548:n:3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.