Mandatory Minimum Sentencing, Drug Purity, and a Test of Rational Drug Use

As of 1987, the Anti-Drug Abuse Act (ADAA) has imposed mandatory minimum sentences for drug traffickers based on the quantity of the drug involved regardless of its purity. Using the STRIDE dataset on drug arrests and a differences-in-differences approach, I find that this led to an increase in cocaine purity of 42% and an increase in heroin purity of 30%. Using data on emergency room visits, I show that the concurrent rise in drug-related ER episodes is due to the rise in the standard deviation of drug purity rather than the increase in average purity. Estimates suggest that the increases in standard deviations at the time of the ADAA translate to increases in cocaine and heroin ER mentions of 15% each. Because these negative outcomes depend only on the standard deviation of purity, this suggests that drug users respond rationally by reducing the quantity consumed in response to anticipated increases in the purity of these drugs. Finally, again using the STRIDE data, I find that the ADAA is associated with an increase in the standard deviation of cocaine purity, implying more cocaine ER mentions.