Snydicated RAND study on legalization in California

By on February 20th 2012

Altered State? Assessing How Marijuana Legalization in California Could Influence Marijuana Consumption and Public Budgets

Within this context, this RAND occasional paper is intended to inform the debate about marijuana legalization in California. Although marijuana legalization could have many consequences, this paper focuses largely on two outcomes that are central to the debate in California: the effect on consumption and public budgets.

To learn more about the possible outcomes of marijuana legalization, we constructed a model based on a series of estimates. As we discuss in more detail in Chapter hree, projections of legalization’s efects on consumption and public budgets hinge on estimates of current consumption, current and future prices, how responsive use is to price changes (what economists refer to as the price elasticity of demand), taxes levied and possibly evaded, and the aggregation of many nonprice efects (such as the potential reduction in stigma). These components, or parameters, of the model are then combined to produce a base-case model estimate.


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