NCJ Number
163872
Date Published
1995
Length
31 pages
Annotation
Using the industry analysis model developed by Michael Porter to understand the level of profitability in an industry, this study examines both the conventional and unconventional aspects of the illegal drug industry; it also examines the implications of the analysis for policy.
Abstract
According to Porter, the level of profitability in an industry is determined by five major factors: the extent of the rivalry among existing firms, the number and kind of potential entrants, the bargaining power of the buyers or consumers, the bargaining power of suppliers, and the threat of substitute products or services. This study recommends a more comprehensive intelligence analysis that examines that areas that are provisionally explored in this paper, especially the degree of cooperation and conflict in the industry and the nature of entry and exit barriers. A second recommendation is that efforts be made to minimize cooperation in the industry and encourage competition and even conflict. The author also recommends the lowering of entry barriers and an increase in existing barriers; interdiction and law enforcement should focus less on the small, inexperienced trafficker and focus instead on the well- established members of the cartels and triads. Another recommendation is to try to increase the power of the basic commodity supplier; rather than seeing the strength of the peasants as inhibiting eradication, this strength should be channelled against the trafficking organizations themselves. A fifth recommendation is to devote greater attention and resources to demand reduction, but not at the expense of the efforts to deal with the organizations involved in supply. Other recommendations are to weaken the firms within the drug industry, to focus explicitly on the local-global nexus, and to make resource decisions with explicit consideration of the likely impact of particular policies and actions on the drug trafficking industry. 44 notes