Black market economics: enforcement, adaptation, and the paradox of prohibition

The keynote explores the unintended consequences of drug law enforcement in Australia. It begins by examining longitudinal trends in drug arrests, seizures, and enforcement funding, highlighting the escalation of prohibition efforts. This is followed by an analysis of key market indicators for our most popular illicit drugs (e.g., cannabis, cocaine, MDMA, methamphetamine), including prevalence, price, accessibility, and purity, revealing a paradox: drug availability is increasing despite intensified enforcement.

The keynote then introduces potential causal mechanisms such as game theory, the kingpin strategy, and other unintended consequences of enforcement, explaining how traffickers adopt a ‘smuggler’s mindset’ which enables them to adapt to intensified enforcement. A contemporary case study on the emerging war on nicotine will then draw parallels with traditional drug markets, illustrating how similar enforcement strategies are generating black market opportunities.

The keynote ultimately questions the effectiveness of prohibition and advocates for a reconsideration of enforcement-led approaches in favour of demand and harm reduction strategies.

Dr James Martin, Senior Lecturer, Criminology Course Director, School of Humanities and Social Sciences, Deakin University

Dr James Martin is a Senior Lecturer in Criminology and Director of the Bachelor of Criminology. James is a leading researcher in the field of black markets, cybercrime, and the dark web trade in illicit drugs. He has published numerous books and research articles on these topics in some of the world’s most prestigious publications, including the British Medical Journal, Criminology & Criminal Justice, and the British Journal of Criminology. James has also led or participated in large-scale research projects funded by the National Health and Medical Research Council and the Australian Institute of Criminology. James is a founding member of the Cryptomarkets Research Hub, an interdisciplinary research networks focused on the dark web illicit drugs trade with more than 100 members located around the world.

Dr James Martin smiling