Applied Micro - Tim Moore (Purdue University)

Title: Opioid Use, Health and Crime: Insights from a Rapid Reduction in Heroin Supply

Abstract: In 2001, a large and sustained supply shock halted a heroin epidemic in Australia. We use treatment records to identify nearly 30,000 opioid users and examine how this shock affected their health and criminal activity over the next eight years. Initially, the gains from fewer overdose deaths are offset by substitution to other drugs and more violent crime, including homicides. Most adverse effects dissipate quickly and are followed by further mortality improvements and large decreases in property crime. Our results demonstrate that reducing the illicit opioid supply can lead to meaningful longer-term improvements, even when the short-term effects are ambiguous.