Why Drug Dealers Still Live with Their Moms & Power-Law Distributions

“Experts,” Journalists and Conventional Wisdom 1990s: Crack cocaine is fostering a very affluent criminal underclass that could overwhelm police offers in terms of weapons and resources! If so, why did most of the crack dealers still live in the projects with their moms? The answer, as always, lies in the data. Drug dealers are rarely trained in economics, and economists rarely hang out with crack dealers.

“Experts,” Journalists and Conventional Wisdom Univ. of Chicago grad. student: Sudhir Venkatesh (Indian) - What did subsequent data collection efforts reveal about the gang’s crack cocaine operations? If drug dealers make so much money, why are they still living with their mothers? - Answer: How much money do they actually make? - 2 nd Answer: What is their chance of being killed?

“Experts,” Journalists and Conventional Wisdom Rising to the top of drug dealing is not unlike rising to the very, very top of any profession. What is it like? RULES: -You must start … -You must be willing to work … -You must be more than … -Once you realize that you won’t make it, you will... Crack cocaine’s devastating effect on the African American community

Managing People’s Choice & Power-Law Distributions - 80/20 rule -LAPD and bell curves extreme concentration of bad officers -Homeless people: 80% in and out in 1 day 10% “episodic users” 3 weeks at a time, frequent drug users 10% “chronic”, mentally ill, physically disabled, MOST expensive Solving car pollution, bad officers, chronic homelessness would be cheaper than “managing” it, so why don’t we do it? Why does the economic perspective clash with the moral perspective?