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URBAN AFFAIRS REVIEW

" The Factors of Production in Retail Drug Deal ing "

by Mark A.R. Kleiman and Rebecca M. Young

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THE FACTORS OF PRODUCTION IN RETAIL DRUG-DEALING MARK A. R. KLEIMAN John F. Kennedy School of Government

REBECCA M. YOUNG Citizens for Juvenile Justice

Drug control efforts are conventionally divided into supply-side (enforcement) and demand-side (preventive education and treatment) policies. The economic concept offactors ofproduction can help illuminate the conditions that support drug consumption and distribution. The factors necessary for drug markets are a common venue; the buyers' access to the venue, desire for drugs, income, and perceived chance of impunity; and the sellers' labor, operating scope within the venue, supply of drugs, ways to spend or save money earned, and perceived chance of impunity. The optimal strategy for any situation will concentrate on those factors that can most readily be made scarce relative to the others.

The past 15 years have seen an explosion of certain kinds of drug dealing and of public concern about drug dealing and drug consumption. Yet neither the nature of the problem nor the range of alternative approaches to controlling it is well understood.

TRADITIONAL MODELS OF THE DRUG PROBLEM

Public policies that deal with the drug problem are often divided conceptually into supply-side approaches (law enforcement) and demand-side approaches (preventive education and treatment). That distinction has been AUTHORS' NOTE: This work was supported by the National Institute of Justice, Program on Drugs and Crime, under Grant No. 89-IJ-CX-OOI. The views expressed in this article are ours and do not necessarily reflect those of the Kennedy School of Government, Harvard University, or Citizensfor Juvenile Justice. We gratefully acknowledge the expert research assistance ofMara Krongard. URBAN AFFAIRS REVIEW, Vol. 30, No. 5, May 1995 730-748 1995 Sage Publications. Inc.

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persuasively criticized as overly simplistic (Moore 1979; Office of National Drug Control Policy 1989). Although some antidrug programs, such as interdiction (supply side) and school-based education (demand side), can be clearly categorized, most attempts to address the drug problem have more complex effects. For instance, although drug treatment is clearly a demandside strategy, making treatment available to drug dealers may influence the supply of drug-dealing labor and, therefore, the supply of drugs. Despite the problems with this dichotomy, it continues to playa powerful role in public discussions of drug policy, so much so that the ratio of supply-side to demand-side efforts in the federal budget has become a matter of ideological and even partisan debate (Majority Staffs of the Senate Judiciary Committee and the International Narcotics Control Caucus 1990; Office of National Drug Control Policy 1994). Another debate, less publicly resonant, concerns the appropriate allocation of enforcement resources along the chain of production and distribution, from raw crops in the field to the final retail sale. Here the argument is between high-level approaches (crop eradication and laboratory destruction, source-country enforcement, interdiction, and investigation of large-scale domestic traffickers) and low-level approaches aimed at disrupting retail trafficking (Chaiken 1988; Kleiman and Smith 1990; Moore 1973; Reuter and Kleiman 1986). Others argue that all enforcement policies are largely irrelevant and that the drug problem is caused by deeper economic and social problems that can only be cured by broader economic and social reforms (Currie 1985). The discussion on this point resembles-in its form , ideological loading, and ultimate futility-the debate on the root causes of crime (see Wilson 1983). The supply-versus-demand debate reflects the extent to which both academic and governmental thinking about the drug situation has been influenced by the language and the explanatory schemata of economics. Over the past two decades , there has been an effort to develop descriptions of drugrelated behavior and approaches to drug-abuse control based on a market metaphor (Boyum 1992; Caulkins 1990; Moore 1973, 1976; Kleiman 1989; Kleiman, Lawrence, and Saiger 1987; Kleiman and Smith 1990; Reuter and Kleiman 1986; Spence 1977). Drugs are seen as having buyers and sellers, supply and demand curves, production functions , and industry structures. In the enforcement-oriented literature, authors tend to assume that the demand function is determined exogenously and, hence, deal mainly with various policies to change the supply curve. Most thinking about prevention and treatment tends to treat the supply situation (prices, costs of purchase other than price, and search times) as given, and the focus is on changing

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demand. These perspectives provide the basis for dividing programs into demand side and supply side and for identifying supply with enforcement and demand with prevention and treatment. Alongside the pragmatic debate about how best to apply resources to diminish the problem, there is a social-scientific debate about how best to describe retail drug-market phenomena. Some neighborhoods, some cities, and some countries are home to far more, and far more flagrant, retail drugdealing than others. What explains the variations? Which of the important explanatory variables can be manipulated by deliberate public action? It seems unlikely that only two dimensions (supply versus demand or high level versus low level) are adequate for either prescription or description. The conceptual model they represent is simply not rich enough. The major polarity within popular and political views of the subject is defined by varying degrees of emphasis on only three factors: drugs, sellers' impunity, and consumers' desire. The focus on these factors overestimates their potential to solve the problem and misses many opportunities to ameliorate the situation by targeting other factors involved in retail drug-dealing. In this article, although we maintain a modified form of the supply! demand distinction for taxonomic purposes, we use the economic concept of factors of production to sketch a fuller model of the conditions that support drug consumption and distribution and to illustrate policies that specifically target each of those conditions. We begin with a description of the factorsof-production model as it applies to retail drug markets; then we list and briefly discuss some of the tactics that might be employed against each of the 10 factors of production. When innovative or unconventional tactics are described, examples of their use in specific cases are provided.

FACTORS OF PRODUCTION In the nineteenth century, David Ricardo first analyzed the economics of agriculture in terms of three factors of production: land, labor, and capital (Heilbroner 1953; Sraffa 1951). The concept of factors of production is straightforward: With a list of the items required to produce any commodity, it is possible to determine, for any given production technology, how much more of the commodity could be produced with one additional unit of input (e.g., an extra hour of labor) while holding the other inputs fixed and to distinguish among different production technologies based on the mix of factors used (handicraft tends to be labor intensive, whereas automated production is capital intensive).

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For any fixed production technology (when a technology is defined by its ratio of factor inputs) and any given budget of inputs, there will be one (or sometimes more than one) factor in short supply relative to the others; this is called the limiting factor of production. For example, consider baking a pound cake with a recipe calling for a pound of sugar, a pound of butter, a pound of flour, and six eggs. If the baker had two pounds each of butter, sugar, and flour but only six eggs, eggs would be in relative scarcity and would, therefore, constitute the limiting factor. Procuring more butter would not allow the baker to produce any more pound cake because butter is not (relatively) scarce. By contrast, an additional half-dozen eggs would allow the production of two cakes instead of one; with three fewer eggs, only half a pound cake could be made. In the more general case, when production technology is flexible rather than fixed (i.e., when it is possible to produce slightly more of the output by slightly increasing anyone of the inputs), the question ''What is the scarce factor of production?" is generalized to "For each factor of production, what is the marginal product?"-that is, the ratio of additional output to additional input of a given factor, holding the other factors constant. First developed for agriculture and manufacturing, the study of production has since been adapted to make it applicable to retail sales and service industries, which make up a growing share of economic activity. From the production-management viewpoint, the distinguishing fact about such activities is that the customer is considered a part of the production process (Heskett 1986).

FACTORS OF PRODUCTION IN RETAIL DRUG·DEALING Examining the factors of production in the process that produces retaildrug transactions can serve as an aid both to understanding the way drug markets and current drug-control efforts work and to developing new approaches to drug control. From this perspective, one can ask about any antidrug action, What factor of production does it target? Does it reduce the factor effectively? How will diminishing the availability of that factor affect the production process? If drug-control policy makers identify the scarce or high-marginal-product factors of production in producing retail-drug transactions, they may be able to bring their resources to bear at points of maximum effectiveness (see Moore 1979). (Of course, effectiveness makes up only half the picture when it comes to choosing policies. The other half is

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TABLE 1: The 10 Factors of Production in Retail Drug-Dealing (common factor = venue) Buyers '-Side Factors

Sellers' -Side Factors

Access to venue Desire for drugs Income Perceived chance of impunity (in buying and using)

Operating scope within venue Drug supply Incentive Labor supply within venue Perceived chance of impunity (in selling)

costs: in money, in forgone alternative uses of the same resources, in the suffering imposed by the control efforts on drug buyers and sellers, and in the inconvenience imposed on nonparticipants in the illicit markets.) Consider an individual retail-drug transaction: Two persons meet and exchange illegal drugs for money. This requires a seller (present either in person or by proxy), a buyer, and a place for them to meet (venue). The buyer's side of the transaction requires access to the dealing venue, a source of income with which to make the purchase, a desire for the drug, and some perceived chance of consummating the transaction and consuming the drugs purchased with impunity. The seller's side requires a supply of labor (either the seller or an employee) willing to work within the venue, operating scope (the capacity to act in a certain way within the venue), a supply of drugs, opportunities to spend or to save to maintain the incentive, and again, an expectation of impunity. Thus, in this account, there are 10 factors of production (see Table 1). Any program intending to minimize the drug market, whether aimed at reducing consumption, commerce, or the unwanted side effects of either, must target one or more of these factors of production. Determining the right mix of such efforts is essential to defining a sensible strategy. As the setting in which drug transactions occur, venue can be important in determining several characteristics of a market, particularly the buyers' access, sellers' operating scope, and the expectations of impunity of both. Tactics for targeting venue are set forth in Table 2.

TARGETING VENUE

Venues can be divided into two categories: flagrant and discreet. A street-comer drug market and a crack house are both indiscreet-one because it is in plain view and the other because of the lack of legitimate activity to divert attention from illicit transactions. A customer's living room is highly

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TABLE 2: Tactics to Thrget Venue If property is owned by a public authority: Boarding up or demolishing vacant buildings Redesigning apartment houses to eliminate corridors Locking external doors to apartment buildings Evicting dealers If property is privately owned: Nuisance abatement "Bawdy-house" laws Code enforcement Forfeiture or threat of forfeiture

discreet, but candy-store owners, taxi drivers, elevator operators in hotels and office buildings, and bartenders can also deal discreetly because they have frequent legitimate occasion to be alone with strangers. Venues may also be categorized as indoor or outdoor. Some indoor venues can be eliminated entirely through the actions of public officials and private citizens. Redesigning apartment buildings, particularly publicly owned ones, to eliminate interior corridors and boarding up or demolishing vacant buildings will destroy the venues themselves. The razing of some abandoned buildings and the securing and cleanup of others were crucial components in successfully eliminating drug trafficking in the formerly crack-infested Link Valley neighborhood of Houston (Kennedy 1990). However, the 1988 largescale destruction of abandoned homes used for crack sales in Tampa, although popular, accomplished little in combating the drug trade until it became one item on a broad menu of tactics developed by the highly effective Quick Uniform Attack on Drugs (QUAD) Program (Kennedy 1993). Short of the literal destruction of buildings, a variety of lesser measures can also help eliminate dealing venues. Evicting tenants who are dealing from their apartments will at least temporarily put an end to dealing in those units. For dealer-owned premises, forfeiture will have the same effect. (The threat of forfeiture can also be used to encourage landlords to carry out evictions.) A dealing location can also be eliminated if it is legally closed and physically sealed by public authorities. Under common-law principles, courts have the authority to order the abatement of public nuisances, and drug-dealing premises have been held to qualify (Cadwalader, Wickersham, and Taft 1993). In addition, some states have "bawdy-house" statutes, specifically providing for the closure of premises used for illicit trade. Premises can also be summarily closed for violations of fire, health, safety, and building codes. In Tampa, the assignment of a city-code-enforcement officer to the QUAD program resulted in the closure of many such locations (Kennedy 1993).

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Indoor dealing venues will generally offer less convenient access, particularly for novice customers. Because both the law of search and seizure and the difficulty of direct observation make indoor dealing harder to enforce against than outdoor dealing, sellers have a greater sense of impunity indoors. If enough potential indoor venues can be eliminated, the result may be fewer consummated transactions. However, to the extent that displaced indoor markets move outdoors, the neighborhood may be adversely affected. Outdoor venues will place a greater burden per transaction on nearby persons and institutions, because flagrancy increases visible disorder and because obvious buyers and sellers are easy targets for violence and, hence, they are likely to arm themselves and to become sources of violence as well. Clearly, outdoor venues cannot be eliminated-there will always be parks and street corners-but whether they are used for drug dealing can be affected by targeting other factors of production: sellers' operating scope, buyers' or sellers' expectations of impunity, and buyers' access.

TARGETING BUYERS'-SIDE FACTORS Table 3 provides a list of tactics that can be used to target buyers' -side factors. The following is a detailed discussion of these tactics. ACCESS

Limiting drug purchasers' access to dealing locations can help eliminate drug markets or at least move them to other sites. Rigorous parking and traffic enforcement near open drug markets can restrict buyers' access to those venues. The use of traffic checkpoints has deterred drug buyers, particularly suburbanites, who drive into urban neighborhoods to "score." For example, police stopped drivers coming into Link Valley in Houston to "warn them they were entering a danger zone" (Kennedy 1990,5). Neighborhood residents received stickers allowing them to go through the checkpoints without being stopped. Although there was some evidence of displacement of the market to nearby locations, that soon ceased as the new market areas were themselves targeted (Kennedy 1990). Turning through streets into dead ends or changing two-way traffic into one-way traffic can also reduce the amount of traffic in drug-dealing areas. In 1993, the grid pattern of streets in the Five Oaks community of Dayton, Ohio, was subdivided into 10 separate cul-de-sac neighborhoods. The result-

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TABLE 3: Thetics to Thrget Buyers' -Side Factors

Access to venue Parking and traffic enforcement Blocking off streets or changing them to one-way streets Checkpoints Door attendants in housing projects Picket signs and bullhorns used by antidrug citizens' groups Desire for drugs Antidrug messages (school, media, neighborhood) Treatment (including maintenance) Income Target hardening for property-crime targets Antiprostitution efforts Drug testing for employees and benefit recipients Restitution orders for drug-involved offenders Buyers' sense of impunity "Sell-and-bust" operations (increase undercover activity) Sales of "turkey dope" Observation arrests Questioning suspected market participants Picket signs and bullhorns used by antidrug citizens' groups Seizure and forfeiture of vehicles Car checks and postcards Drug testing for drug-involved offenders Drug testing for employees and benefit recipients Fmes Publicity

ing 67% reduction in traffic flow appears to have put a serious dent in local drug dealing and crime (Cose 1994). Access to indoor dealing venues can also be curtailed. Locking apartment buildings and employing uniformed door attendants to verify the identity of all entrants can greatly reduce drug buyers' access to those locations. DESIRE

Reductions in buyers' desire for drugs directly affect the market by decreasing demand. Various educational efforts in schools, neighborhoods, and through the media can convince some prospective drug users not to start (Pentz et al. 1989). There has been increased use of uniformed police officers in schools nationwide. The most publicized of such programs, Drug Abuse Resistance Education (D.A.R.E.), originated in Los Angeles in 1983 and has spread to all 50 states as well as several foreign countries. It employs trained

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police officers to teach highly structured courses focused on decision making and resistance to peer pressure to children in their last year of elementary school. However, the program has evidently had no significant effects on attitudes about, or use of, drugs (Evaluation and Training Institute 1988; Ringwalt et al. 1994; Rosenbaum et al. 1994). Drug treatment is another way to decrease or eliminate buyers' desire for drugs. There is clear evidence that heroin users in methadone maintenance programs buy less heroin (and commit fewer crimes) than addicts not in such programs and that residential treatment programs (whether participation is voluntary or coerced) can cause long-term reductions in drug buying (Anglin and McGlothlin 1981; Anglin and Speckart 1986, 1988; Speckart and Anglin 1986). Treatment Alternatives to Street Crime (T.A.S.c.) programs and "drug courts" work to reduce the desire for drugs on the part of drug-using offenders by requiring them to accept drug treatment as an alternative to prison. INCOME

Many strategies can be employed to limit the income of drug buyers. Target hardening for property-crime targets (e.g., unstealable car radios) might help eliminate the income sources of some drug-using property criminals. Requiring drug-involved offenders to pay restitution to their victims also limits their disposable income. Antiprostitution efforts, to the extent that they are successful, decrease prostitutes' earnings and thus their available cash for drug purchases. Testing employees for drug use and terminating those who test positive and refuse treatment would also reduce the (licit) incomes of some drug users. Similar strategies might be employed with recipients of general-relief and public-housing residents, although the ultimate results of such efforts could be increased property crime and homelessness. Tactics that increase the price of drugs also help put a strain on buyers' incomes. This is one of the goals of high-level drug enforcement (the other being to limit the physical supply of drugs). If buyers respond to higher prices by reducing drug consumption, the effort has succeeded. However, if they respond by cutting back on food , clothing, and shelter or by increasing their income from illicit sources, successful high-level enforcement may have perverse effects (Brown and Silverman 1974; Boyum and Kleiman 1994). BUYERS' SENSE OF IMPUNITY

The more reason buyers have to fear detection and arrest and the more harassment they experience, the less buying they are likely to do. A variety

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of law enforcement tactics aims at reducing buyers' sense of impunity. Undercover officers selling inert substances packaged as drugs ("turkey dope") discourage users who discover they have wasted good money on bad drugs. "Sell-and-bust" operations, which use undercover police officers posing as drug dealers, can be effective in deterring customers, especially novices. In 1988, the Birmingham Police Department's Operation 'Caine Break videotaped multiple drug sales by undercover officers to repeat customers; several months later, they issued arrest warrants during a highly publicized three-day period (Uchida, Forst, and Annan 1992). Police officers who simply observe drug transactions can make arrests on the basis of what they see, thus reducing buyers' (and sellers') impunity in street markets. Even stopping suspected drug-market participants for questioning can serve as a deterrent. Because there are more buyers than sellers of drugs, arresting purchasers must be a high-volume activity to be an effective deterrent. However, the fact that the criminal justice system is so overloaded puts a premium on tactics that do not involve arrest and trial. The seizure and (administrative) forfeiture of vehicles driven by drug buyers is one such tactic that could work to reduce buyers' expectations of impunity. The Wayne County, Michigan, Prosecuting Attorney's Office initiated Campaign PUSH-OFF (Purchasers' Use of Streets and Highways; Opt for Forfeitures) to use the state's forfeiture laws as a means of deterring drug buyers. Considered to be a jail alternative, PUSH-OFF encourages local police to seize the vehicles of drug buyers upon a finding of probable cause that the vehicle is being used to transport drugs or to facilitate violations of drug laws. The vehicle's driver is served notice, and the vehicle is seized on the spot and towed. The owner can redeem the vehicle for $900 plus towing and storage fees, contest the seizure and post $250 cost bond, or forfeit the vehicle. The $900 redemption fee is split between the Prosecuting Attorney's Office ($150) and the seizing police agency ($750). In effect, this is a nonjudicial fine. A one-week program of intensive PUSH-OFF enforcement succeeded in substantially reducing observed drug transactions in a target area for at least the subsequent six weeks, albeit with significant displacement to a nearby area (SPEC Associates 1993). Notifying buyers with automobiles that their presence at a drug-dealing location was recorded is an even simpler tactic. Civilians or police who observe out-of-neighborhood cars driving through drug-market areas can log the license plates. Police can follow up by sending postcards to the owners stating where their vehicles were seen and indicating that the sites are known drug-dealing locations. The owners can be further warned that their vehicles

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are subject to forfeiture if drugs are found in them. If the buyers are, for example, the children of the registered vehicle owners, the repercussions of such postcards may be substantial. Drug testing of persons on bail, probation, or parole, along with imposing sanctions for positive tests, can decrease the purchase activity of an important subset of buyers (Kleiman and Smith 1990; Toborg and Kirby 1984). Such tests do occur in the current probation and parole systems, but they tend to be infrequent-typically once a month or less-and sanctions for positive and missed tests tend to be erratic, although sometimes quite severe (several months of incarceration is not uncommon). Frequent, perhaps weekly, testing and short, but automatic, sanctions for violations could serve as deterrents for the large number of offenders who currently use drugs (Kleiman and Rudolph 1992). This tactic, known as coerced abstinence, in some ways resembles drug courts and T.A.S.C. but is potentially more comprehensive in its coverage and less constrained by the capacity of the treatment system. Drug courts are restricted to those who have committed drug-law violations and are further restricted to those offenders who choose to participate in the program; coerced abstinence would apply to all drug-involved offenders. Coerced abstinence should further be differentiated from drug courts in that it would not necessarily replace incarceration as the punishment for the offense but should accompany it (Tauber 1994). Drug buyers can also be threatened with loss of income if drug testing is made a condition of employment or the receipt of public benefits, although the value and propriety of, in effect, using employers and welfare agencies as law enforcers are open to question (APT Foundation Task Force 1988; DuPont 1984; Normand, Lempert, and O'Brien 1994; Cavanagh, Boyum, and Kleiman 1994). Neighborhood residents, too, can affect buyers' and sellers' expectations of impunity in both indoor and outdoor markets. By picketing, marching, shouting through bullhorns, taking photographs, and so on around the venues, they can draw attention to the sites, making the customers and dealers alike feel unwelcome and threatened by the possibility of police taking notice.

TARGETING SELLERS'-SIDE FACTORS Table 4 provides a list of tactics that can be used to target sellers' -side factors. The following discussion describes how these tactics can be used.

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TABLE 4: 'Thctics to Target Sellers' -Side Factors Operating scope Towing cars Cutting brush Lighting Door attendants in housing projects Antigun measures (seizures and gun control) Drug supply Crop eradication Source-country law enforcement Interdiction Long-term undercover operations Historical investigation of drug conspiracies Electronic surveillance Financial investigation High-level supplier enforcement "Buy-and-bust" operations ''Working-up-the-chain'' investigations Control of intermediate chemicals and dilutants Incentive Denying saving opportunity Money-laundering investigations Seizures and forfeiture Civil suits Fines Denying spending opportunity Tax investigation Checking ownership records of jewelry and cars Dress codes for students, probationers, and parolees Forfeitures Fines Labor Job programs to divert labor to licit markets Sanctions for lookouts Penalties for using minors "Working-up-the-chain" investigations Prosecution of minor gang-related crimes Field interrogation Boys' Clubs and athletic leagues Sellers' impunity "Buy-and-bust" operations Observation arrests Citizen hot lines Searches Special prosecution policies Forfeitures Continued

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TABLE 4 Continued Evictions More jaiUprison capacity Special penalties for armed dealers More capacity for non prison sanctions Noncriminal punishments Finding and using fingerprints Electronic surveillance Beat cops Work with citizens' groups Questioning suspected market participants Mandatory abstinence and urine monitoring

OPERATING SCOPE

In addition to threatening dealers with arrest, retail-level enforcement activities can force dealers into more cumbersome operating styles (e.g., they may need to break up the seller's job among runners, holders, and money handlers). Cutting brush, adding outdoor lights to dark areas, and towing abandoned cars can help eliminate good sites for drug caches, thus complicating outdoor selling and limiting a dealer's operating scope within a particular venue. The Tampa QUAD program used various tactics to reduce the capacity of drug dealers to move freely within their venues. Officers who parked marked vehicles at drug-dealing sites, walked around such locations in uniform, or even sat in lawn chairs beside dealers quickly deterred drug trafficking at those spots. Other effective techniques included making dealers physically uncomfortable by removing couches and chairs that they had set up and by cutting back trees that shaded them from the powerful Florida sun (Kennedy 1993). DRUG SUPPLY

The announced goal of much high-level drug enforcement activity is to make drugs unavailable-or at least in sufficiently unreliable supply at the wholesale level to interfere with retail operations. The list of tactics here is familiar: crop eradication, source-country law enforcement, and enforcement directed at the physical transport of drugs from source countries into the United States (interdiction). In addition, there is a panoply of high-level investigative techniques including long-term undercover operations, historical investigation of drug conspiracies, electronic surveillance, financial in-

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vestigation, and so on. The hope of enforcement agencies is that if the high-level supplier-"Mr. Big"--can be put out of business and the organization disrupted, current retail dealers will find themselves out of stock, and the recruitment of new retail dealers will be slowed. Forfeitures of high-level dealers' assets are designed to decrease the incentive for new high-level suppliers to replace the old ones. Retail-level buy-and-bust operations, in which police impersonate drug users for the purpose of catching retail dealers in the act of distribution, attack sellers' impunity. But if, as often happens, some of the retail sellers caught in the trap are offered lenient treatment on the condition that they, in turn, help make cases against their suppliers, the result is increased distrust of retail dealers by higher-level dealers. This process of "working up the chain" makes it more difficult for a new retailer, or an established retailer known to be facing charges, to find a supplier. The extent to which bulk drugs, particularly mass-market drugs with established retail networks, can be made scarce has been a matter of debate. In general, law enforcement professionals have been optimistic about this approach. Economists, on the other hand, have been pessimistic. Several observations support their pessimism: the very large financial rewards of successful drug wholesaling, its modest skill requirements, the extent to which a smaller-scale success can finance a subsequent larger purchase, and the apparent flexibility of distribution networks (Reuter and Kleiman 1986). The street-level tactics of the Tampa QUAD program were effective in creating a short-term drug shortage for some dealers. Equipped with digital beepers, Tampa police were easily accessible to neighborhood residents eager to rid their community of drugs. Tipped off by these observers about specific outdoor locations where dealers had stashed supplies of drugs, officers were sometimes able to confiscate the crack supply directly. With the aid of K-9 officers, police were able to do this in the absence of any tips as well. This approach appears to have reduced the ability of retail sellers to acquire the drug, because wholesalers became less willing to extend credit to dealers. INCENTIVE

The income from dealing drugs is either spent or saved. Interfering with sellers' ability to spend or save can reduce their willingness to accept the risks of dealing. Forfeitures and fines directly target dealers' accumulated wealth. These tactics are more frequently employed at the wholesale than at the retail level, because wholesalers are more likely than retailers to have wealth in quantity and in a form (cash or bank accounts) that is easy to store, pending

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resolution of the case. One of the values of forfeitures, from the viewpoint of local law enforcement agencies, is that many state laws allow the proceeds to be recycled through their budgets. But retail dealers also have wealth, at least in the form of expensive clothing,jewelry, and automobiles. More vigorous efforts to deprive them of these possessions through forfeitures might reduce the value, in their eyes, of their drug-dealing earnings. Some schools have instituted dress codes specifically to reduce the pressures on their students to match drug dealers' clothing expenditures. A limit on the value of clothing and jewelry worn could be made part of probation and parole orders or imposed on juvenile offenders by juvenile courts. However, this strategy requires the capacity to observe and to impose appropriate sanctions for violations. LABOR

Retail drug-dealing, like other forms of retailing, consumes time spent purchasing and selling drugs, as well as waiting for customers. In addition to their own labor, some dealers employ the labor of others who serve as runners, spotters, steerers, money handlers, and so on. To the bored and unemployed, their own leisure time may not be very valuable. Employment or recreational opportunities can help increase the perceived value of time and thus the reservation wage (the lowest wage one will accept) of potential suppliers of drug-selling labor. Thus job and recreational programs may be important antidrug measures. However, a recent study showing that many drug dealers also hold legitimate jobs is somewhat discouraging on this score (Reuter et al. 1990). That study suggests that decreasing the supply of sellers' labor by putting some sellers in prison-the incapacitation effect-is also likely to be ineffective, because those now working part-time as dealers constitute an "industrial reserve army." SELLERS' SENSE OF IMPUNITY

The obvious way to decrease sellers' sense of impunity is to increase their probability of arrest by increasing police presence. But in many jurisdictions, current levels of drug arrests have already swamped court and corrections systems. Thus arrests may not be the limiting factor of production in generating deterrence. Punishing drug dealers more severely will involve some combination of three steps: increasing prison populations, increasing the proportion of prisoners serving time for drug dealing (rather than violent or property

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crime), and increasing the supply of nonprison punishments such as home confinement, curfews, community service, and intensive probation. Increasing the proportion of drug offenders serving time, however, will necessarily reduce deterrence for predatory crime, as drug offenders fill an increasing proportion oflimited confinement capacity: about one-third of the 1.2 million persons now behind bars in the United States are there for drug-law violations, and the increase in drug-related incarcerations has accounted for the majority of the growth in prison populations over the past decade. Similarly, one major problem with expanding alternative sentencing programs under current conditions is that their ultimate effectiveness depends upon the availability of prison cells as back-up sanctions for those offenders who fail to comply (e.g., who refuse to pay restitution or skip assigned hours of community service). Given the prison shortage, those back-up cells may not be available (Cavanagh and Kleiman 1990). The deterrent value of any punishment depends on the probability of suffering it (certainty) and its magnitude (severity). One of the bestdocumented findings of behavioral psychology is that beyond some low threshold, any gi ven total amount of punishment has a greater deterrent effect if it is spread out with high probability but low severity rather than being concentrated with low probability but high severity (Cook 1980; Johnston 1972). This is consistent with the finding in experimental economics that, contrary to the prescriptions of expected utility theory, people tend to be risk-loving when losses are concerned (Tversky and Kahneman 1974). Thus increasing the length of drug sentences is a much less efficient way to employ scarce prison space in decreasing sellers' perceived chance of impunity than in increasing the probability of apprehension, conviction, and some sentence. This fairly obvious observation has not been sufficient to deter state legislatures and, more notably, Congress from passing more and more sweeping and draconian statutes providing long mandatory sentences for even low-level and nonviolent participants in drug transactions, especially for cocaine in smokable form ("crack") (U.S. Department of Justice 1994). The effect of such policies is to increase the suffering associated with enforcing the drug laws and to crowd nondrug offenders out of scarce prison space, without significantly reducing the volume of illicit drugs sold or the suffering associated with their sale and use.

USING THE FACTORS-OF-PRODUCTION MODEL Law enforcement agencies have tended to evaluate the effectiveness of antidrug efforts in terms of numbers of arrests. In a time of backlogged court

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dockets and overcrowded prisons, it is important for those addressing the drug problem to think more broadly. The factors-of-production model provides a framework for considering how to intervene in the drug problem existing at particular locations and a vocabulary of possible solutions for police departments engaging in problem-solving policing (Goldstein 1990). In addition, it may suggest that focusing on a criminal organization or individual as the unit of analysis may be less helpful than focusing on a geographic area. By determining which factors are scarce and can most easily be targeted in a particular locale, those working to combat the drug problem can increase the use of arange of tactics rather than focus primarily on those that involve arrest.

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Mark A. R. Kleiman is an associate professor of public policy at the John F. Kennedy School of Government, Harvard University. His primary research topics are drug policy and crime control. He is the author of Marijuana: Costs of Abuse, Costs of Control (1989, Greenwood Press) and of Against Excess: Drug Policy for Results (1992, Basic Books). He is currently at work (with David Boyum) on The DrugS/Crime Connections to be published by Harvard University Press in 1997. Rebecca M. Young is the executive director of Citizens for Juvenile Justice. She is a candidate for a master:r degree from the Lyndon B. Johnson School of Public Affairs, University of Texas at Austin. Her research interests include services to juvenile crime victims, correctional health care, and crime and politics.