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The Cross-Border Spillover Effects of Recreational Marijuana Legalization

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  • Zhuang Hao
  • Benjamin Cowan

Abstract

We examine the spillover effects of recreational marijuana legalization (RML) in Colorado and Washington on neighboring states. We find that RML causes a sharp increase in marijuana possession arrests in border counties of neighboring states relative to non-border counties in these states. RML has no impact on juvenile marijuana possession arrests but is rather fully concentrated among adults. Using separate data on self-reported marijuana use, we show this is accompanied by an increase in use in neighboring states relative to non-neighboring states. We do not find conclusive evidence that marijuana sale/manufacture arrests, DUI arrests, or opium/cocaine possession arrests in border states are affected by RML.

Suggested Citation

  • Zhuang Hao & Benjamin Cowan, 2017. "The Cross-Border Spillover Effects of Recreational Marijuana Legalization," NBER Working Papers 23426, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:23426
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    References listed on IDEAS

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    Cited by:

    1. Thanh Lu, 2021. "Marijuana legalization and household spending on food and alcohol," Health Economics, John Wiley & Sons, Ltd., vol. 30(7), pages 1684-1696, July.
    2. Michele Baggio & Alberto Chong & David Simon, 2018. "Sex, Drugs, and Baby Booms: Can Behavior Overcome Biology?," NBER Working Papers 25208, National Bureau of Economic Research, Inc.
    3. Kalbfuss, Jörg & Odermatt, Reto & Stutzer, Alois, 2024. "Medical marijuana laws and mental health in the United States," Health Economics, Policy and Law, Cambridge University Press, vol. 19(3), pages 307-322, July.
    4. Øyvind Thomassen & Howard Smith & Stephan Seiler & Pasquale Schiraldi, 2017. "Multi-category Competition and Market Power: A Model of Supermarket Pricing," American Economic Review, American Economic Association, vol. 107(8), pages 2308-2351, August.
    5. Brett Hollenbeck & Kosuke Uetake, 2021. "Taxation and market power in the legal marijuana industry," RAND Journal of Economics, RAND Corporation, vol. 52(3), pages 559-595, September.
    6. Michele Baggio & Alberto Chong & Sungoh Kwon, 2020. "Marijuana and alcohol: Evidence using border analysis and retail sales data," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 53(2), pages 563-591, May.
    7. Hansen, Benjamin & Miller, Keaton & Weber, Caroline, 2020. "Federalism, partial prohibition, and cross-border sales: Evidence from recreational marijuana," Journal of Public Economics, Elsevier, vol. 187(C).
    8. Dragone, Davide & Prarolo, Giovanni & Vanin, Paolo & Zanella, Giulio, 2019. "Crime and the legalization of recreational marijuana," Journal of Economic Behavior & Organization, Elsevier, vol. 159(C), pages 488-501.
    9. Inayat Ullah & Dong-Young Kim, 2021. "Inclusive Governance and Biodiversity Conservation: Evidence from Sub-Saharan Africa," Sustainability, MDPI, vol. 13(7), pages 1-27, March.
    10. Muhammad Salar Khan & Paul N. Thompson & Victor J. Tremblay, 2020. "Marijuana tax incidence, stockpiling, and cross-border substitution," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 27(1), pages 103-127, February.

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    More about this item

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K14 - Law and Economics - - Basic Areas of Law - - - Criminal Law

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