Cocaine Prices And Crime Rate

The Atlantic Cities:

Plenty of other theories have been offered to account for the double-digit decrease in violence, from the advent of "broken windows" policies, three strikes laws, changing demographics, gun control laws, and the increasing prevalence of cellphones to an upturn in the economy and cultural shifts in American society. Some of these theories have been disproven outright while others require a healthy dose of assumption to turn correlation into causation. But much less attention has been paid to another likely culprit: the collapse of the U.S. cocaine market.
Cocaine was the driving force behind the majority of drug-related violence throughout the 1980s and into the early 1990s. It was the main target of the federal War on Drugs and was the highest profit drug trade overall. In 1988, the American cocaine market was valued at almost $140 billion dollars, over 2 percent of U.S. GDP. The violence that surrounded its distribution and sale pushed the murder rate to its highest point in America's history (between 8-10 per 100,000 residents from 1981-1991), turned economically impoverished cities like Baltimore, Detroit, Trenton and Gary, Indiana, into international murder capitals, and made America the most violent industrialized nation in the world.
Then in 1994, the crime rate dropped off a cliff. The number of homicides would plummet drastically, dropping almost 50 percent in less than ten years. The same would go for every garden variety of violent crime on down to petty theft. The same year as the sharp decline in crime, cocaine prices hit an all-time low. According to the DEA's System to Retrieve Information on Drug Evidence (STRIDE) data, the price per gram of cocaine bottomed out in 1994 at around $147 (calculated in 2003 dollars), the lowest it had been since statistics became available.

More competition from other drugs like methamphetimines, which can be produced locally, are credited with some of the fall in price.