Just This Once: A More Plausible Model of Addiction and Its Policy Implications
87 UMKC L. REV. 817 (2019).
10 Pages Posted: 24 Aug 2018 Last revised: 29 Apr 2019
Date Written: August 1, 2018
Existing models of rational addiction like that of Becker and Murphy (1988) cannot be taken seriously as models of real human addiction, because most addicts did not intend to become addicted and deeply regret starting use of the addictive good. I present a more plausible model of addiction, where addicts misunderstand the difference between (1) the probability of getting addicted after just one use, and (2) the probability of just one use. Even if the probability of addiction after just one use is low, the probability of just one use is not as low as a first-time user might assume, suggesting that many of those who try an addictive good "just this once" end up using more often, leading to addiction and the regret that rejects the Becker and Murphy model. This more plausible model has strong policy implications, most notably a need to focus on deterring the first use of harmful addictive substances, even those that are legal and remain so. For addictive-like goods and experiences that are beneficial - like exercise - the model suggests a greater focus on encouraging people to try the activity once without focus on follow up, taking advantage of the likelihood that one-time users of something like walking 10,000 steps in a day are more likely to exercise again in the future than the person might otherwise believe.
Keywords: Rational Addiction, Irrational Addiction, Behavioral Economics, Bayesian Analysis, Health Economics
JEL Classification: A13, B41, C11, D11, D18, D69, D91, I12, I18, K19, K23, K32, K42
Suggested Citation: Suggested Citation