How Powdered Cocaine Flows Across the United States: Evidence From Open-Source Price Data

Patterns of flows of cocaine across the United States are identified using open-source price data. The data set consists of wholesale prices for powdered cocaine for 112 U.S. cities published biannually by the National Drug Intelligence Center (NDIC) between 2002 and 2011. For each of the 6,126 possible unique pairs of cities in the sample, cocaine is inferred to flow from the city with the lower price to the city with the higher price if the prices in the two cities show a correlation that exceeds a threshold value. This threshold value is calibrated using data on anecdotal city-to-city flows published by the U.S. Department of Justice. The results show a striking pattern of cocaine flows from the south and west of the United States to the north and east. A cluster analysis of cities based on inward and outward links is used to classify each city as a "source," "destination," "transit," or "isolate."