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How Cannabis Legalization Could Change Illegal Drug Markets

The effects went far beyond the marijuana market.

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A study published in the scientific journal Addiction provides the most comprehensive evidence to date of the association between recreational cannabis laws in U.S. states and responses in the illegal markets for cannabis, heroin and other drugs in those states.

As of 2021, 17 U.S. states and the District of Columbia have implemented RCLs that allow people aged 21 and older to possess, use and supply limited amounts of cannabis for recreational purposes. This study found that the implementation of RCLs was associated with the following responses in the illegal drug market in those states:

  • 9.2% decrease in street/illegal cannabis prices.
  • 19.5% decrease in low-quality street/illegal cannabis prices.
  • 64% increase in heroin prices.
  • 54% increase in heroin potency.
  • 7.3% increase in street/illegal oxycodone prices.
  • 5.1% increase in street/illegal hydrocodone prices.
  • 93% decrease in law enforcement seizures of street/illegal cannabis
  • >50% decrease in law enforcement seizures of heroin, oxycodone, and hydrocodone

Lead author Dr. Angélica Meinhofer, assistant professor of population health sciences at Weill Cornell Medicine, says, "Our exploratory findings suggest that markets for illegal drugs may not be independent of legal cannabis market regulation. As more states move towards legalization and additional post-RCL implementation data become available, we'll need to do more research to determine whether recreational cannabis laws cause those changes in the illegal market and what happens in the long-term."

This study used a difference-in-differences analysis of the staggered implementation of RCLs in 11 states to compare changes in outcomes between RCL and non-RCL states. This study used crowdsourced data from Price of Weed and StreetRx on the price and quality of illegal drugs, which may be subject to error and sampling bias.

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