"Copping" in heroin markets: The hidden information costs of indirect sales and why they matter

Abstract

Ethnographic research identifies brokering (a.k.a., "copping for others") as an important and popular way people who use heroin acquire the drug by making purchases for their peers. Brokering is when a customer buys drugs for a fellow customer using the buyer's money and is paid using drug the buyer purchases. This distributes heroin costs. Heroin dealers obviously manipulate price and/or drug purity to make profits and compete for buyers, but a hidden way they alter "price" is by adjusting the size of heroin packages they sell. Using an agent-based model, we simulate brokering and heroin package resizing to understand how these dynamics influence heroin consumption costs. High rates of dealer arrest are tested against these dynamics. Findings indicate the Quantity-Adjusted Price of heroin is greater than its retail price in all conditions, implying increased competition in heroin markets does not lower costs. © 2013 Springer-Verlag.