The impact of drug use on earnings: a life-span perspective

Cross-sectional and longitudinal causal analyses were carded out on a longitudinal cohort of employed adult males (N = 400) to investigate the relationship between various forms of drug use and earnings. By age 35, there are no cumulative effects of the use of illicit drugs on wages. Specification of the relationships at various stages of the life cycle reveals that the effects of illicit drug use are positive in the early stages of labor force participation (by the late twenties) but negative in later stages (by the mid-thirties). The negative impact of drug use on earnings appears to take more than a decade to manifest itself and is reflected in lower rates of earnings growth. We propose that a labor market theory of life-cycle compensation contracts and investments in training and the differential impact that different types of job changes have in the short and the long run among users and nonusers provide a partial accounting of the processes underlying the observed opposite relationships between drug use and earnings at different age periods. The importance of adopting a life-span perspective is highlighted by our findings.
Drug Use and Labor Force Achievement Until recently, lifestyle factors, especially those indexing nonconforming values and behaviors, were rarely included in models of socioeconomic achievement. However, involvement in drugs, especially [...]