Bringing Perspective to Illicit Markets

Estimating the Size of the U.S. Marijuana Market

Published in: Drug and Alcohol Dependence, v. 119, no. 1-2, Dec. 2011, p. 153-160

Posted on on January 01, 2011

by Beau Kilmer, Jonathan P. Caulkins, Rosalie Liccardo Pacula, Peter Reuter

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Having a sense of the scale of an illicit drug market is important for projecting consequences of alternative policy regimes. In this article, we review two general approaches to drug market estimation--supply-side and demand-side--before turning to a more specific analysis of studies that measure the size of the U.S. marijuana market. The paper then generates a demand-side estimate of U.S. marijuana consumption for 2009 and shows how variation in assumptions such as grams per joint and extent of underreporting can cause substantial variation in estimates of market size. While both demand-side and supply-side estimates have weaknesses, the paper argues that the former are more promising for marijuana and offers suggestions on how to reduce the uncertainties surrounding them.

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