Publication Date

August 2006

Publication Details

Levy, A, A Theory of Relative Deprivation and Myopic Addiction, Working Paper 06-20, Department of Economics, University of Wollongong, 2006.


Myopic use of mind-altering substances is proposed to be equal to the product of the user’s current levels of relative-deprivation feeling and substance-tolerance. If initially this product is sufficiently large the user is trapped in a deprivation-use-addiction vicious cycle. There may be a relatively high addiction and socioeconomic position steady state and a relatively low one. If the users are initially located in the high steady state, an increase in treatment is clearly socially desirable. In contrast, the possible improvement of users’ socioeconomic position from increasing law-enforcement or socioeconomic opportunities might be dominated by a rise in users’ addiction level.