By Vivian Mateos Zúñiga and David A. Shirk

Scholars and legalization advocates have argued that the legalization of cannabis would help curb drug flows from Mexico and weaken criminal organizations south of the border. However, there is little empirical research examining how the legalization of cannabis for medical and recreational purposes at the state-level in the United States has affected production levels and flows of cannabis from Mexico. To examine the theory that drug legalization reduces the incentives and profits for international drug trafficking organizations (DTOs), the authors draw on a mixed methodological approach that includes descriptive and inferential statistical analysis of data from the U.S. State Department, archival research using primary and open-source documents from U.S. and Mexican government and media sources, and interviews with U.S. officials and security experts to analyze trends in seizures and legalization. Drawing on this information, we employ a series of statistical tests to examine the relationship of greater legal access to cannabis in U.S. states—measured by the percentage of the population living in states with access to legalized medical or recreational marijuana over time—to illegal eradication and seizures of drugs by Mexican government and U.S. border authorities. We use this measurable outcome as a proxy for illicit drug production and transshipment in Mexico. We find a substantial and statistically significant decrease in the amounts of cannabis apprehended by Mexican and U.S. border authorities in relation to the rate of legalization in the United States using our measurements of drug legalization. At the same time, the authors find additional statistically significant evidence that, as legal access to cannabis has increased, flows of other illicit drugs increased simultaneously, suggesting that criminal organizations have diversified into other drugs to remain profitable, particularly heroin and methamphetamine. Our findings do not find any evidence that cocaine has been significantly affected, for reasons we discuss.   

Volume 19, Number 1 January 2022 San Diego: Justice in Mexico, University of San Diego, 2022.

By Katharine Neill Harris, Christopher F. Kulesza

Roughly half of the U.S. population now lives in a state that permits recreational cannabis use and sales. Still, the criminal legal system continues to play a primary role in determining who receives treatment for cannabis use. It remains the single largest treatment referral source, and in 2019 more than 100,000 people who were admitted to treatment for cannabis use were referred by a legal entity. This raises questions regarding the extent to which individuals who interact with the legal system are monitored and punished for cannabis use in the post-legalization era. Moreover, the issue has not been addressed by state legalization measures. We examined trends in legal system referrals to treatment for cannabis use in legal and nonlegal states from 2007 to 2019. We also tested the relationship between recreational cannabis legalization and legal system treatment referrals for Black, Hispanic, and white adults and juveniles. The legal system’s practice of requiring individuals to participate in drug treatment warrants scrutiny because of its potentially negative and long-lasting consequences. While mandated treatment may be appropriate in some cases, the legal system often requires treatment participation from individuals who do not meet the criteria for a substance use disorder, and it does a poor job of connecting those who do have substance use disorders with appropriate care. The legal system’s limited efficacy in this arena is problematic because mandated treatment carries the possibility of additional legal consequences if program expectations are not met. The harmful effects of legal involvement include fewer education and employment prospects, reduced earning potential, destabilized family structures, negative mental and physical health outcomes, and diminished quality of life. Communities of color are disproportionately targeted by drug enforcement and disproportionately impacted by its collateral consequences. Recreational cannabis legalization (RCL) is intended to remedy, in part, the harmful and racially disparate effects of cannabis prohibition. However, the continuation of compulsory treatment for cannabis use, and the legal involvement it entails, is a potential pathway through which the systemic harms and inequities of cannabis prohibition can persist. The problematic nature of this arrangement is enhanced when it occurs alongside a commercial cannabis industry that profits from greater levels of cannabis use 

Houston, TX: The Baker Institute, 2023. 44p.   

By Michelle Minton and Geoffrey Lawrence

Hawaii may be poised to become the 25th state to legalize the recreational use of cannabis for adults aged 21 and over. Nearly 90 percent of Hawaii residents supported full legalization of cannabis for adult use in a January 2023 poll conducted by the Hawaii Cannabis Industry Association. Gov. Josh Green has said he would sign a legalization bill if one is delivered to his desk—marking a significant departure from former Gov. Dave Ige, who left office in 2023. During the 2023 legislative session, lawmakers considered proposals to legalize adult-use cannabis. One of these bills was passed by the state Senate but was not heard in the state House of Representatives. Between the conclusion of the 2023 legislative session and the convening of the 2024 session, Attorney General Anne Lopez met with key lawmakers to develop proposed language for a legalization bill that could gain the support of the administration and the legislature. This working group produced a 315-page draft bill, introduced in each chamber of the legislature as House Bill 2600 and Senate Bill 3335, respectively. Despite having played a key role in drafting the legislation, however, the attorney general’s office testified in early hearings that it “does not support the legalization of adult-use cannabis,” although the current legislation is a “good faith effort toward protecting the public welfare and is an improvement on previous bills that have been heard by the legislature.” Reason Foundation has offered recommendations for improvement to successive cannabis legalization proposals in Hawaii. Several of these recommendations were adopted by Senate committees during the 2023 legislative session. Reason Foundation has also reviewed the provisions of Senate Bill 3335, as amended, and submitted recommendations for improvement. This brief goes beyond those recommendations and provides key background on the Hawaiian marijuana market and considerations for market structure and tax policy. Cannabis consumers are price-sensitive and have many options for purchasing cannabis. Prices and availability within the licensed cannabis industry can strongly influence the decisions of both producers and consumers to either participate in this industry or engage in illicit cannabis activity. In California, high taxes and a lack of legal sellers resulted in roughly two-thirds of cannabis demand being satisfied by the illicit market six years after legalization. The prevalence of illicit sales also negatively affects state tax collections, as only a minority of cannabis transactions are legal and subject to taxation. California has recently begun to take corrective action to lower the tax-induced price disparity between licensed and illicit goods, but Hawaiian lawmakers can circumvent the rise of large illicit markets with an appropriate market design. 

Los Angeles: The Reason Foundation, 2024. 18p.

By Kevin Brookes and Édouard Hesse

Bringing new and innovative ideas to light and advancing liberal reforms is the core mission of the European Liberal Forum. We do not do this alone but in close cooperation with a network of member and partner organizations across Europe. The present English translation of an original report by the French liberal think-tank GenerationLibre is part of this broader effort. Through this collaboration, we hope that the report’s important messages will reach a wider audience, in Europe and beyond. What better topic to start our collaboration than cannabis, as plans for the liberalization of the drug unfold across the continent. In December 2021, Malta became the first EU Member State to legalize the cultivation and personal consumption of cannabis. The new German government is contemplating similar legalization, and other countries could follow suit. Legalizing is a difficult endeavor, as this report shows, but a necessary one since the detrimental consequences of criminalization have never been felt more clearly. Prohibition is a failure. It has not managed to stem the rise in cannabis consumption rates, either in Europe or worldwide; it has failed to protect users from the most acute forms of harm; and it has contributed to the growth of criminal networks. This can be seen in Europe, where entire swathes of our cities are under the control of organized crime, whose main revenues originate from the illegal cannabis business. Those who prohibition should in theory protect the most, youngsters who are most at risk of harm when using the drug, are the main victims, sometimes literally, from the current situation. Prohibition is also at odds with our liberal values. The state should inform and provide a helping hand to those who err but should not prosecute and imprison people who have freely decided to engage in risky practices. The law should refrain from expressing moral judgments and only prohibit behaviors that bring significant harm to others or society. From this perspective, there is only a weak basis for prohibiting cannabis, a substance far less problematic for public health than alcohol and tobacco  Fully legalising cannabis is the only way forward. But decriminalization is only a first step towards the inclusion of cannabis in the normal legal channels of the economy. It would not only constitute a significant reform of our police and criminal justice systems, but it would also enable public authorities to devise an effective public health policy, targeting youngsters especially. It would also allow an entirely new economic sector to flourish, creating hundreds of thousands of jobs across Europe and generating a considerable amount of revenue for the public purse. Based on a systematic and thorough review of past and current experiences in cannabis legalization, this report shows, perhaps unsurprisingly, that, as in many other areas, free market solutions are superior to state planning and state monopolies. Only a legal solution that is sufficiently cheap and competitive can replace the black market and bring the benefits expected from legalization. The state should regulate the product and ensure that those who participate in the cannabis business offer sufficient guarantees but it should not arbitrarily set prices or restrict distribution channels – to do so would run the risk of having legalized ‘for nothing’. Europe has all the cards in hand to be at the forefront of drug policy reform and show the rest of the world that another path is possible. Courage and method are all we now need  

Brussels:  European Liberal Forum EUPF , 2022. 53p.

By Delvon T. Mattingly a b, Maggie K. Richardson c, Joy L. Hart 

Cannabis use is increasing due to several factors including the adoption of laws legalizing its use across the United States (US). We examined changes in current cannabis use among US youth and adults and by key sociodemographic groups. Methods: Using data from the 2013-2022 National Survey on Drug Use and Health (n=543,195), we estimated the prevalence of (2013-2019, 2020, 2021-2022) and trends in (2013 2019, 2021-2022) current (i.e., past 30-day) cannabis use among US youth (aged 12-17) and adults (aged 18+) overall and by age, gender, race and ethnicity, educational attainment, and total annual family income. We also examined sociodemographic factors associated with use from 2013-2019, in 2020, and from 2021-2022. Results: Cannabis use increased from 7.59% to 11.48% in 2013-2019, was 11.54% in 2020, and increased again from 13.13% to 15.11% in 2021-2022. Among youth, cannabis use remained constant from 2013-2019 and 2021-2022. In 2022, use was highest among aged adults 18-34, male, non-Hispanic multiracial, and generally lower SES adults. From 2021-2022, cannabis use increased among several groups such as adults who were aged 35-49 (14.25% to 17.23%), female (11.21% to 13.00%), and Hispanic (10.42% to 13.50%). Adults who were aged 18-25, male, non-Hispanic multiracial, some college educated, and of lower annual family income had consistently higher odds of current cannabis use from 2013-2019, in 2020, and from 2021-2022. Conclusions: Cannabis use is increasing overall and among certain sociodemographic groups. Our findings inform prevention and harm reduction efforts aimed at mitigating the burden of cannabis use in the US. 

Drug and Alcohol Dependence Reports

By Alex Brill, Brian J. Miller, Stan Veuger

Federal legislation to legalize, regulate, and tax cannabis could have significant impacts on the federal budget. While the specific details of any potential cannabis legalization legislation are unknown at present, such reforms are likely to affect both tax receipts and federal outlays through a wide range of mechanisms including excise tax collections, changes in the size and composition of the labor force, and the major federal health care programs. We identify the main federal budgetary implications of legalizing cannabis and estimate their likely magnitude where possible.

AEI Economics Working Paper 2023-16 Updated March 2024   Washington, DC: American Enterprise Institute, 2024. 41p.