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What Drug Dealers Tell Us About Their Costs of Doing Business

NCJ Number
180296
Author(s)
Jonathan P. Caulkins; Bruce Johnson; Angela Taylor; Lowell Taylor
Date Published
1998
Length
27 pages
Annotation
Interviews with low-level drug dealers in New York City revealed that the financial costs of distributing drugs were modest, that the proportion of sales revenue retained by these sellers was a meaningful indicator of their earnings, and that the four distinct types of drug sellers differed substantially in the proportion of sales revenue retained.
Abstract
The data came from an ongoing large ethnographic study designed to develop a systematic understanding of crack selling and drug careers. The research involved systematic observations of more than 1,500 different crack sellers and distributors in the field. The researchers selected about 300 distributors of crack and other drugs as focal participants, interviewed them at least once between 1989 and 1996, and interviewed about one-third again at a later date. The interviews often lasted 1-3 hours each. Verbatim transcriptions produced about 4.8 million words of transcripts and field notes for analysis. The transcripts were searched by computer based on five categories of keywords relating to drug selling. Results revealed that the entrepreneurs who owned the drugs they sell retain about 50 percent of the sales revenue. In contrast, independent consignment sellers retained about 25 percent, consignment sellers who operated within fixed selling locations or spots retained about 10 percent, and sellers paid hourly to sell from spots retained 3 percent. Findings suggested that these differences might explain variations in reports of drug sellers' earnings. In addition, findings may have significant implications for the relative ability of drug law enforcement against spots and enforcement against sellers outside spots to drive up drug prices and suppress drug use. 29 references

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