Marijuana Regulation: Impact on Health, Safety, Economy


The enactment of adult use cannabis regulation is not associated with significant upticks in marijuana use by adolescents

  • “The main goal of this study was to compare cannabis-related public health outcomes between illicit, medical, and adult use states. … Dated collected … from the quarterly Regulatory Determinants of Cannabis Outcomes Survey demonstrated that greater risks of cannabis-related harms were associated with states where cannabis remains illicit compared to states where cannabis is regulated. Specifically, when comparing cannabis-related harms across state legalization status, the current analyses revealed that states with regulated medical or adult use cannabis showed: Older age at cannabis first use; Fewer days of past-month cannabis use for those 16-20 years old; Fewer days or driving under the influence of cannabis in the past month. Notably, there were no differences observed among the three state legalization statuses in terms of overall cannabis prevalence, cannabis use disorder prevalence, and overall health status.”
  • “The overall percentage of students who reported using marijuana at least 1 time during the previous 30 days in 2019 was not measurably different from the percentage in 2009 (21 percent)…. There was no measurable difference between 2009 and 2019 in the percentage of students who reported that illegal drugs were made available to them on school property.”
  • “Canada legalized recreational cannabis use for adults on October 17, 2018 with decision-makers emphasising the need to reduce cannabis use among youth. We sought to characterize trends of youth cannabis use before and after cannabis legalization by relying on a quasi-experimental design evaluating cannabis use among high school students in Alberta, British Columbia, Ontario, and Québec who participated in the COMPASS prospective cohort study. Overall trends in use were examined using a large repeat cross-sectional sample (n=102,685) at two time points before legalization (16/17 and 17/18 school years) and one after (18/19 school year). … In the longitudinal sample, no significant differences in trends of cannabis use over time were found between cohorts for any of the three use frequency metrics. Therefore, it appears that cannabis legalization has not yet been followed by pronounced changes on youth cannabis use.”
  • “Youth Risk Behavior Survey data from 47 states from 1999 to 2017 assessed marijuana, alcohol, cigarette, and e-cigarette use among adolescents (14-18+ years; N = 1,077,938). Associations between RML (recreational marijuana legalization) and adolescent past-month substance use were analyzed using quasi-experimental difference-in-differences zero-inflated negative binomial models. … Controlling for other state substance policies, year and state fixed effects, and adolescent demographic characteristics, models found that RML was not associated with a significant shift in the likelihood of marijuana use. … Results suggest minimal short-term effects of RML on adolescent substance use, with small declines in marijuana use.”

The establishment of cannabis retailers is not associated with upticks in criminal activity

  • “Using data covering the period 2000-2019 from a variety of national sources (the National Survey of Drug Use and Health, the Uniform Crime Reports, the National Vital Statistics System, and the Treatment Episode Data Set) this study is the first to comprehensively examine the effects of legalizing recreational marijuana on hard drug use, arrests, drug overdose deaths, suicides, and treatment admissions. Our analyses show that RMLs increase adult marijuana use and reduce drug-related arrests over an average post-legalization window of three to four years. There is little evidence to suggest that RML-induced increases in marijuana consumption encourage the use of harder substances or violent criminal activity.”
  • “We conducted a series of multi-group interrupted time series of monthly crime rates comparing Colorado and Washington to states which have yet to legalize marijuana. … Our results suggest that cannabis laws more broadly, and the legalization of recreational marijuana more specifically, have had minimal effect on major crime in Colorado or Washington State. We observed virtually no statistically significant long-term effects of recreational marijuana legalization or retail sales on violent or property crime rates, except for a significant decline of burglary rates in Washington. … Our results are robust in that we examined the first two states to legalize marijuana and compared them to states with no marijuana laws at all. … Our results from Colorado and Washington suggest that legalization has not had major detrimental effects on public safety.”
  • “This paper studies the effects of marijuana legalization on neighborhood crime and documents the patterns in retail dispensary locations over time using detailed micro-level data from Denver, Colorado. … The results imply that an additional dispensary in a neighborhood leads to a reduction of 17 crimes per month per 10,000 residents, which corresponds to roughly a 19 percent decline relative to the average crime rate over the sample period. … Overall, our results suggest that dispensaries cause an overall reduction in crime in neighborhoods, with no evidence of spillovers to surrounding neighborhoods. … Our results are consistent with theories that predict that marijuana legalization will displace illicit criminal organizations and decrease crime through changes in security behaviors or substitution toward more harmful substances. … Lastly, there is no evidence that increased marijuana use itself results in additional crime.”

Medical cannabis access laws are not associated with adverse effects on traffic safety

  • “Consistent with an improvement in traffic safety, we find that the legalization of medical cannabis leads to a decrease in auto insurance premiums on average of $22 per policy per year. The effect is stronger in areas directly exposed to a dispensary, suggesting increased access to cannabis drives the results. In addition, we find relatively large declines in premiums in areas with relatively high drunk driving rates prior to medical cannabis legalization. This latter result is consistent with substitutabil-ity across substances that is argued in the literature.”
  • “While attention has been given to how legalization of recreational cannabis affects traffic crash rates, there [has] been limited research on how cannabis affects pedestrians involved in traffic crashes. This study examined the association between cannabis legalization (medical, recreational use, and recreational sales) and fatal motor vehicle crash rates (both pedestrian-involved and total fatal crashes). … We found no significant differences in pedestrian-involved fatal motor vehicle crashes between legalized cannabis states and control states following medical or recreational cannabis legalization. Washington and Oregon saw immediate decreases in all fatal crashes (-4.15 and -6.60) following medical cannabis legalization. … Overall findings do not suggest an elevated risk of total or pedestrian-involved fatal motor vehicle crashes.”
  • “This paper reports a quasi-experimental evaluation of California’s 1996 medical marijuana law (MML), known as Proposition 215, on statewide motor vehicle fatalities between 1996 and 2015. … We found that legalizing medical marijuana in California led to a sustained reduction in statewide motor vehicle fatalities. … California’s 1996 MML appears to have produced a large, sustained decrease in statewide motor vehicle fatalities amounting to an annual reduction between 588 and 900 vehicle fatalities.”

Adult-use marijuana laws have generally been associated with few changes in traffic safety, though more recent studies have yielded less consistent findings

  • “There are efforts in recent years to fully legalize marijuana for recreational purposes. However, the evidence on the potential socioeconomic costs, as well as the prospective benefits, of such policy is still limited. In particular, there is a concern that expanding access to recreational marijuana would lead to more traffic crashes. Using county-level data from Colorado and exploiting the variation in the timing of retail cannabis store entry across Colorado’s counties, I examine the effect of recrea- tional cannabis dispensary entry on traffic crash incidents. … [T]here is a lack of evidence that the traffic crash rate is statistically significantly affected by the entry of recreational cannabis dispensary. Most of the estimates are small in magnitude and not statistically significantly different from zero. The preferred estimate suggests that, at 90% confidence level, a large increase in traffic crashes by more than 5% can be ruled out.”
  • “Utilizing provincial emergency department (ED) records (April 1, 2015-December 31, 2019) from Alberta and Ontario, Canada, we employed Seasonal Autoregressive Integrated Moving Average (SARIMA) models to assess associations between Canada’s cannabis legalization (via the Cannabis Act implemented on October 17, 2018) and weekly provincial counts of ICD-10-CA-defined traffic-injury ED presentations. … Implementation of the Cannabis Act was not associated with evidence of significant post-legalization changes in traffic-injury ED visits in Ontario or Alberta among all drivers or youth drivers, in particular.”
  • “We performed a prospective observational study on the use of cannabis and other illicit drugs in the trauma population at a lead Canadian trauma centre in London, Ontario, in the 3 months before (July 1 to Sept. 30, 2018) and 3 months after (Nov. 1, 2018, to Jan. 31, 2019) the legalization of cannabis in Canada. … We found that the rate of positive cannabinoid screen results among patients with trauma referred directly to our trauma service was similar in the 3 months before and [in] the 3 months after the legalization of recreational cannabis in Canada. … In the subgroup of patients whose mechanism of trauma was a motor vehicle collision, there was no difference in the rate of positive toxicology screen results or positive cannabinoid screen results between the two periods. … These preliminary single-centre data showing no increased rates of cannabis use in patients with trauma after legalization are reassuring.”
  • “A retrospective analysis of data collected at trauma centers in Arizona, California, Ohio, Oregon, New Jersey, and Texas between 2006 and 2018 was performed. … The data were analyzed to evaluate the trends in THC and alcohol use in victims of MVC [a motor vehicle crash], related to marijuana legalization. … There did not appear to be a relationship between the legalization of marijuana and the likelihood of finding THC in patients admitted after MVC. … There was no apparent increase in the incidence of driving under the influence of marijuana after legalization.”

Marijuana regulation is not associated with adverse effects on workplace performance or safety

  • “We evaluate the effect of RMLs [recreational marijuana laws] on WC [workers’ compensation] benefit receipt and WC income over the period 2010 to 2018 using the Annual Social and Economic Supplement (ASEC) of the Current Population Survey (CPS). … Our results show a decline in WC benefit propensity of 0.18 percentage points (‘ppts’), which corresponds to a 20.0% reduction in any WC income, after states legalize marijuana for recreational use. Similarly, we find that annual income received from WC declines by $21.98 (or 20.5%) post-RML. These results are not driven by pre-existing trends. … The present study provides empirical evidence on the consequences of marijuana legalization on issues related to the labor market outcomes, in particular, WC claiming of older adults. … Our findings suggest potentially important benefits to older workers and society at large. Broadly, we show non-trivial improvements in work capacity, which we proxy with WC benefit receipt and various other metrics in our mechanism analysis, among older adults.”
  • “[T]he current body of evidence does not provide sufficient evidence to support the position that cannabis users are at increased risk of occupational injury.”
  • “We study the effect of state medical marijuana laws (MMLs) on workers’ compensation (WC) claiming among adults. … We use data on claiming drawn from the Annual Social and Economic supplement to the Current Population Survey over the period 1989 to 2012, coupled with a differences‐in‐differences design to provide the first evidence on this relationship. Our estimates show that, post MML, WC claiming declines, both the propensity to claim and the level of income from WC. These findings suggest that medical marijuana can allow workers to better manage symptoms associated with workplace injuries and illnesses and, in turn, reduce need for WC.”

Marijuana regulation is associated with declining alcohol consumption

  • “We use data on purchases of alcoholic beverages in grocery, convenience, drug, or mass distribution stores in US counties for 2006-2015 to study the link between medical marijuana laws and alcohol consumption and focus on settling the debate between the substitutability or complementarity between marijuana and alcohol. … We find that the legalization of medical marijuana reduces alcohol consumption. We find consistent evidence across different specifications and alcohol products (i.e. alcohol in general, beer and wine). States legalizing medical marijuana use experience significant decrease in the aggregate sales of alcohol, beer and wine. Moreover, the effects are not short lived, with significant reductions observed up to 24 months after the passage of the law.”
  • “Research firm Cowen & Company analyzed the state of the beer industry in Colorado, Oregon and Washington–states where both recreational weed is legal and craft beer has become popular. In those states, beer markets have “collectively underperformed” over the last two years, trailing behind beer sales around the country.”

Marijuana regulation is associated with increased tax revenue and job creation

  • Legal states in 2021 collected an estimated 20 percent more in taxes on retail marijuana sales than on the sale of alcohol products. “[I]t is remarkable that in the span of just a few years, the narrow ‘sin taxes’ that states created to apply to cannabis purchases have managed to surpass the comparable taxes that have long applied to alcohol.”
  • Tax revenues derived from the licensed retail sale of state-legal, adult-use cannabis products grew by more than 30 percent between 2020 and 2021, totaling over $3.7 billion.
  • “America’s 11 operating adult-use markets and 27 medical-only states combined to sell $24.6 billion worth of cannabis products in 2021. Last year also marked the first year that cannabis job creation hit triple figures. After adding 32,700 jobs in 2019 and 77,300 jobs in 2020, the industry added 107,059 new jobs in 2021…. While legal cannabis now supports 428,059 jobs, the total employment potential in a mature US legal cannabis market is approximately 1.5 million to 1.75 million workers. The economic and employment potential for legal cannabis remains quite bright for many years to come.”
  • “In this report, we gather data to estimate the direct, indirect, and induced economic contribution of the cannabis sector—comprising cultivators, processors, medical sales holders, and retailers—from legalization to 2021. … We found that the Canadian cannabis sector has made a significant economic contribution to both Canada and Ontario in the three short years since legalization. The industry has generated $11 billion in sales nationwide and made $29 billion in capital expenditures. … Overall, the cannabis industry has contributed $43.5 billion to Canada’s GDP— and $13.3 billion to Ontario’s GDP—since legalization. Moreover, the industry has sustained over 98,000 jobs across Canada and put $15.1 billion into government coffers.”
  • “Since 2014 when sales began in Colorado and Washington, legalization policies have provided states a new revenue stream to bolster budgets and fund important services and programs. As of December 2021, states reported a combined total of $10.4 billion in tax revenue from legal, adult-use cannabis sales. In addition to revenue generated for statewide budgets, cities and towns have also generated hundreds of thousands of dollars in new revenue from local adult-use cannabis taxes.”
  • “This first annual Leafly Cannabis Harvest Report tallies farm licenses and production in the 11 states that have legal adult-use stores open and operating. … In those 11 adult-use states, cannabis supports 13,042 licensed farms that harvested 2,278 metric tons of marijuana [in 2020]. … In each of the 11 states with adult-use retail stores operating, cannabis ranks no lower than fifth in terms of agricultural crop value—often within two years of the first stores opening. … . Legal cannabis is the single most valuable crop in Alaska, Colorado, Massachusetts, Nevada, and Oregon.”

Retail cannabis facilities are associated with rising housing values

  • “To learn how marijuana legalization may impact real estate, we used publicly available data from Zillow and the U.S. Census, among other sources, to explore the relationships between home values, marijuana legalization, dispensaries, and tax revenue. We used multiple regression analyses to model current trends and predict future patterns. … Between April 2017 and April 2021, property values rose $17,113 more in states where recreational marijuana is legal, compared to states where marijuana is illegal or limited to medicinal use. … We found that cities with more dispensaries are positively correlated with higher home values, suggesting legalization boosts jobs and economic growth. … With each new dispensary a city adds, property values increase by $519. … As more states legalize marijuana, there is strong evidence that legalization drives higher property values — particularly in areas that allow recreational marijuana and welcome retail dispensaries. … These investments can improve quality of life in communities across the nation while attracting tourism and new residents who drive real estate demand.”
  • “We evaluate the effect of medical and recreational dispensary openings on housing prices in Denver, Colorado. Using an event study approach, we find that the introduction of a new dispensary within a half‐mile radius of a new home increases home prices by approximately 7.7 percent on average. The effect diminishes for homes further from new dispensaries but is consistent over time. Our results provide important and timely empirical evidence on the socioeconomic impacts of marijuana legalization.”
  • “In this paper we contribute to the debate on the impacts of recreational marijuana legalization on local communities by examining the effects of retail marijuana stores on nearby house prices in Denver, Colorado. … Using a difference-in-differences model, we compare houses that are in close proximity to a retail conversion to those that are slightly farther away from a retail conversion before and after the legalization of recreational sales. We find that after the law went into effect at the end of 2013, single family residences close to a retail conversion (within 0.1 miles) increased in value by approximately 8.4% relative to houses that are located slightly farther from a conversion (between 0.1 miles and 0.25 miles) in 2014 compared to the previous year.”
  • “Does legalizing retail marijuana generate more benefits than costs? This paper addresses this question by measuring the benefits and costs that are capitalized into housing values. We exploit the time-series and cross-sectional variations in the adoption of Colorado’s municipality retail marijuana laws (RMLs) and examine the effect on housing values with a difference-in-differences strategy. Our estimates show that the legalization leads to an average 6 percent increase in housing values, indicating that the capitalized benefits outweigh the costs. … In conclusion, this paper provides convincing causal evidence that legalizing retail marijuana generates net benefits, as measured through the housing market.”