Daniel Rosenblum - An Instrumental Variables Approach to Estimating the Effects of Changes in the Heroin Market on Overdose in the US

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Barbara Broadway

b.broadway@unimelb.edu.au

Melbourne Institute Seminar

Title: An Instrumental Variables Approach to Estimating the Effects of Changes in the Heroin Market on Overdose in the US

Abstract: Preceding the recent massive spike in heroin-related deaths in the US, there was a significant fall in heroin price and a rise in overdose during the 1990s. Similar to the current heroin epidemic, there was wide variation across the US in the increase in the incidence of heroin overdose and death. We use an instrumental variables strategy to investigate the effects of changes in the heroin market on heroin overdose hospital admissions. The instruments are the interaction the timing of the introduction of Colombian-sourced heroin in the 1990s, a large supply shock, with city-level pre-shock characteristics that have been shown to facilitate or hinder the introduction of new heroin sources. The multiple instruments allow us to disentangle the causal effects of multiple city-level heroin market factors that are correlated with overdose: the price per pure gram of heroin, the coefficient of variation of purity of heroin, and the percent of heroin of Colombian origin.

Presenter: Associate Professor Daniel Rosenblum, Dalhousie University

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