Disrupting Drug Markets: The Effects of Crackdowns on Rogue Opioid Suppliers

This paper estimates the impact of doctor crackdowns on the quantity demanded of prescription opioids, across-market substitution, and across-product substitution. Exploiting plausibly exogenous variation in the timing and location of administrative actions, I find cracking down on a single doctor decreases county-level opioid dispensing by 10 percent. This decline persists across space and grows over time. Additionally, significant heroin substitution occurs, yet overall overdose mortality decreases. These results highlight a critical tradeoff policymakers should consider with targeted crackdowns: Reductions in the flow of new users must be balanced against the harm that arises when existing users substitute to more dangerous drugs. (JEL I11, I12, I18, K42)