The Interdictor's Lot

A Dynamic Model of the Market for Drug Smuggling Services

by Jonathan Cave, Peter Reuter

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This Note presents a stylized dynamic model of the market for drug smugglers' services. The model is based on the observation that experienced smugglers may benefit from learning by doing, although the information (and the resulting cost advantage) may be subject to obsolescence. The authors analyze the effects of several variables, including different law enforcement strategies on smugglers of varying degrees of experience, the degree of competitiveness in the supply of smugglers' services, and the conditions governing entry of novice smugglers. The theoretical analysis is supplemented by a Lotus-based simulation model, which is included with the Note, and illustrated by several numerical examples.

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