Abstract
Research on addiction had already yielded a wide range of interesting and important findings when economists first arrived on the scene. The economic study of addiction was initiated by a seminal paper by Becker and Murphy (1988) which challenged the prevailing view of addiction as self-destructive, proposing instead a ‘rational account of addiction’. Although some empirical research has confirmed the model’s critical prediction that anticipated increases in future prices will decrease current demand for a drug, more recent research by economists, stimulated by the prior work from other disciplines, has challenged some of the rational account’s assumption and predictions.
This chapter was originally published in The New Palgrave Dictionary of Economics, 2nd edition, 2008. Edited by Steven N. Durlauf and Lawrence E. Blume
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Acknowledgments
We thank Caroline Acker, Ted O’Donoghue and Antonio Rangel for helpful suggestions.
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Loewenstein, G., Rick, S. (2008). Addiction. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95121-5_2361-1
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DOI: https://doi.org/10.1057/978-1-349-95121-5_2361-1
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