Common assumptions are that consumption will decline when price rises, that heroin consumption leads to revenue-raising crime, and that limiting the heroin user's income-generating opportunities to criminal markets results in an increase in the user's illegal income. A simple reduction strategy that drives up the price of heroin can be expected to reduce the total quantity of heroin consumed, but its impact on the number if new and current users and their criminal activity, is not obvious. In addition, because it is unclear whether narcotics consumption leads to criminal activity, whether criminal activity leads to drug comsumption, or both, the appropriate approach is to consider these two relationships as being simultaneously determined. Furthermore, other research on the varieties of drug use and how users distribute themselves across legal and illegal activities further reduce our expectations of how much crime is caused by heroin use. Without appropriate research on this empirical issue, Federal policies directed at supply and demand reduction cannot have predictable outcomes. 10 references