The Budgetary Impact of Ending Drug Prohibition

Miron, Jeffrey A.; Waldock, Katherine

doi:10.2139/ssrn.1710812

Cited by 48 publications

(32 citation statements)

References 2 publications

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“…8 Moreover, RMLs significantly free local governments from the burden of criminal justice related to marijuana law enforcement (Evans 2013). Miron (2010) estimates that nationwide marijuana legalization could reduce police service, prosecutional, judicial, and incarceration expenses by approximately $13.7 billion per year in the United States, which is roughly twice the estimate of the related tax revenue ($6.4 billion). Miron's statistics also suggest that about 68% of the budgetary savings accrue to state and local governments.…”

Section: B Major Examples Of Benefits and Costs Of Rmlsmentioning

confidence: 99%

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The Effect of Legalizing Retail Marijuana on Housing Values: Evidence From Colorado

Cheng

Mayer

Mayer³

2018

Economic Inquiry

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Does legalizing retail marijuana generate more benefits than costs? This paper provides a first step toward addressing that 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% increase in housing values, indicating that the capitalized benefits outweigh the costs. In addition, we find suggestive evidence that this relatively large housing value appreciation is likely due to RMLs inducing strong housing demand while having no discernible effect on housing supply. Finally, we show that the effect of RMLs is heterogeneous across locations and property types. (JEL K20, R28)

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Section: B Major Examples Of Benefits and Costs Of Rmlsmentioning

confidence: 99%

“…9. Miron (2010) finds that among the $48.7 billion annual budgetary savings due to legalizing drugs, including marijuana, cocaine, heroin, and other drugs, $33.1 billion would accrue to state and local governments and $15.6 million to the federal government.…”

Section: B Major Examples Of Benefits and Costs Of Rmlsmentioning

confidence: 99%

The Effect of Legalizing Retail Marijuana on Housing Values: Evidence From Colorado

Cheng

Mayer

Mayer³

2018

Economic Inquiry

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“…Such measures are in scarce supply because they would need to encompass efforts at different levels of government. An exception is the work of Miron and Waldock (), who provide a rich cross‐sectional measure of the levels of state and local government spending on drug prohibition. The authors collected data on the level of police and judicial resources allocated to drug arrests in order to calculate the budgetary savings of ending drug prohibition.…”

Section: Prohibition Efforts and The Demand For Guard Labourmentioning

confidence: 99%

The Demand for ‘Guard Labour’: Another Explanation

Geloso¹,

Kufenko²

2017

Economic Affairs

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We consider the argument that inequality drives society to expend more resources on supervision, which imposes an extra cost on doing business – an argument advanced notably by Samuel Bowles, who framed it as a coordination failure. We propose an alternative, though not mutually exclusive, explanation in the form of government failure. We argue that the efforts of government to prohibit drugs leads to increases in violence and policing failure, which in turn force private actors to deploy resources to supervise workers and protect themselves. Our explanation complements and moderates the argument regarding the link between inequality and ‘guard labour’.

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“…Policymakers trade off the social costs of addiction with the costs of enforcement when designing optimal drug policy. Costs for the enforcement of drug laws are as much as $40 billion annually in the USA (Miron and Waldock, ). The US incarceration rate per 100,000 residents grew from 100 in 1980 to 492 in 2011 as the share of prisoners convicted of drug offenses increased from 22% to 48% (Blumstein and Beck, ; Carson and Sabol, ).…”

Section: Introductionmentioning

confidence: 99%

Identifying Demand Responses to Illegal Drug Supply Interdictions

Cunningham

Finlay

2015

Health Economics

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Successful supply-side interdictions into illegal drug markets are predicated on the responsiveness of drug prices to enforcement and the price elasticity of demand for addictive drugs. We present causal estimates that targeted interventions aimed at methamphetamine input markets ('precursor control') can temporarily increase retail street prices, but methamphetamine consumption is weakly responsive to higher drug prices. After the supply interventions, purity-adjusted prices increased then quickly returned to pre-treatment levels within 6-12 months, demonstrating the short-term effects of precursor control. The price elasticity of methamphetamine demand is -0.13 to -0.21 for self-admitted drug treatment admissions and between -0.24 and -0.28 for hospital inpatient admissions. We find some evidence of a positive cross-price effect for cocaine, but we do not find robust evidence that increases in methamphetamine prices increased heroin, alcohol, or marijuana drug use. This study can inform policy discussions regarding other synthesized drugs, including illicit use of pharmaceuticals. Copyright © 2015 John Wiley & Sons, Ltd.

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The Budgetary Impact of Ending Drug Prohibition

Cited by 48 publications

References 2 publications

The Effect of Legalizing Retail Marijuana on Housing Values: Evidence From Colorado

The Effect of Legalizing Retail Marijuana on Housing Values: Evidence From Colorado

The Demand for ‘Guard Labour’: Another Explanation

Identifying Demand Responses to Illegal Drug Supply Interdictions

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