ABSTRACT
The economic approach to the analysis of the markets for alcohol, tobacco and illicit drugs deploys the conventional tool kit of the mainstream economist. A market is a network of buyers (demanders) and sellers (suppliers) and an important mechanism by which the demand for addictive substances is equated with its supply is price. If the price of these commodities is increased, other things being equal, the demand of buyers will fall. If prices fall, demand will increase. If the prices of alcohol, tobacco and illicit drugs rise then, other things being equal, this will induce suppliers to provide more of these commodities. If the prices fall, suppliers will be less willing to provide these addictive substances for their users.
