Prohibition Harms the Weakest: Does Consumer Irrationality Justify the War on Drugs

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Jeffrey Miron

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When—if ever—is state control of individual decisions better than self-control? In the rational consumer model, the answer is never. That paradigm assumes that consumers know their own preferences, possess all relevant information, process that information correctly, and make consistent decisions over time. Government interference with individual choices—the substitution of state control for self-control—can therefore only harm individuals, who would make optimal decisions on their own.

If consumers are not fully rational, the case for self-control rather than state control might seem less compelling. Government interference would not automatically reduce the well-being of nonrational consumers, since those non-rational consumers might be making sub-optimal decisions on their own behalf.

This paper argue that consumer irrationality strengthens, rather than weakens, the case for self-control. If consumers are rational about drug use, prohibition makes them worse off. If consumers are not necessarily rational, prohibition might prevent some “bad” decisions to use drugs unnecessarily. Self-control as the approach to drugs might not be perfect, but state control is almost certainly worse.

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