E-Cigarettes & Markets for Addictive Substances

There’s the crux of the issue: Can an ethical market exist for an addictive product? Some economists argue it cannot. Profits will always drive companies to look for new demand for its products, not just satisfy their existing users, creating a new class of dependents. Mark Kleiman, a public policy professor at New York University, has been helping governments design drug legalization policies for years, and recently told Quartz that most profits are made by a small number of heavy users. He said he believes that regulation, not unfettered capitalism, should guide how products with such potential for abuse are sold, citing state-run alcohol stores (such as those in Canada and some US states) that blend a legal retail market with reasonable restrictions and price controls. Without such safeguards on substances such as cannabis and alcohol, legalized markets can simply incentivize firms to lower prices and cultivate unhealthy demand. “There’s no way to get rich on a drug without having someone abuse it,” Kleiman said. “Moderation is not profitable.”