Estimating the Non-Price Effects of Legalization on Cannabis Consumption

by Robert J. MacCoun

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Neither theory nor the available evidence provide a basis for confident predictions of the "non-price" effect of legalization of cannabis on use. But the theory and cases reviewed here suggest that cannabis legalization would plausibly lead to increases in consumption, even without significant price drops. Correctly identifying causal impact is difficult in each of these cases, but if we attribute the largest estimated effects exclusively to the policies, then the Dutch experience suggests a temporary increase of around 35 percent in past-month prevalence. The Alaska and South Australian experiences and the change in the drinking age suggest smaller effects, but these were presumably less dramatic changes than the Dutch experience. Taken together, they suggest that the "non-price" impact on consumption might be on the order of a 35 percent increase in past-month use. Estimates in the range of 5 to 50 percent seem plausible; the available evidence provides no basis for anticipating non-price effects larger than 50 percent.

The research in this report was conducted by the RAND Drug Policy Research Center.

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