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How will cannabis legalization affect health, safety,

and social equity outcomes? It largely depends on
the 14 Ps

Beau Kilmer

To cite this article: Beau Kilmer (2019): How will cannabis legalization affect health, safety,
and social equity outcomes? It largely depends on the 14 Ps, The American Journal of Drug and
Alcohol Abuse, DOI: 10.1080/00952990.2019.1611841

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THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE
https://doi.org/10.1080/00952990.2019.1611841

REVIEW

How will cannabis legalization affect health, safety, and social equity outcomes?
It largely depends on the 14 Ps
Beau Kilmer
RAND Drug Policy Research Center, Santa Monica, CA, USA

ABSTRACT ARTICLE HISTORY

Jurisdictions considering or implementing alternatives to cannabis supply prohibition will con- Received 16 December 2018
front several decisions that will influence health, safety, and social equity outcomes. This essay Revised 18 April 2019
highlights 14 of these design considerations, which all conveniently begin with the letter P: 1) Accepted 23 April 2019
Production, 2) Profit motive, 3) Power to regulate, 4) Promotion, 5) Prevention and treatment, 6) KEYWORDS
Policing and enforcement, 7) Penalties, 8) Prior criminal records, 9) Product types, 10) Potency, 11) Cannabis; legalization;
Purity, 12) Price, 13) Preferences for licenses, and 14) Permanency. For each factor, the paper health; safety; social equity
explains why it is important, describes the various approaches, and highlights how some of the
jurisdictions that have legalized have addressed these choices. The primary audiences are decision
makers considering alternatives to prohibiting cannabis supply and analysts making projections or
conducting evaluations of these changes.

Introduction what are the various approaches, and highlight how

some of the jurisdictions that have legalized have
Canada, Uruguay, and 11 jurisdictions in the United
addressed these choices.
States have removed the prohibition on cannabis and
have legalized supply for adults. This is very different
from the more common approach known as “decrimi- Production
nalization” which typically removes the criminal penal-
ties for possessing small amounts but keeps supply The cost of producing cannabis will plummet with
a criminal offense. Many of these jurisdictions allow legalization (7). Removing the prohibition means
large-scale production and retail sales, but this is not producers no longer need to hide or be compensated
the only way to legalize cannabis. Those considering or for their risk of arrest or incarceration (8). These
implementing alternatives to cannabis supply prohibi- costs will further decline if governments allow pro-
tion will confront several decisions that will influence ducers to compete and grow on industrial-sized out-
health, safety, and social equity outcomes. door farms (9). We see price declines happening now
This essay highlights 14 of these design considerations in Colorado where the average price for a pound of
which all conveniently begin with the letter P. It builds on high-potency cannabis in the licensed wholesale mar-
previous efforts to highlight the various supply architec- ket declined more than 60% from January 2015 to
tures and regulatory decisions surrounding cannabis lega- October 2018, from $2007 to $759 (10). Some suggest
lization (e.g., 1,2,3,4), and two publications using a similar the wholesale price drop in Oregon has been even
alliterative framework (5,6). The primary audiences are more severe (e.g., 11).
decision makers considering alternatives to prohibiting How quickly the wholesale prices decline will
cannabis supply and analysts making projections or con- depend on how much cannabis is allowed to be pro-
ducting evaluations of these changes. duced and the regulations imposed on producers.
Jurisdictions could be strategic and control the amount
of cannabis (or THC) produced, or they could simply
give production licenses to anyone who applies and
The 14 Ps
passes a background check. This not only has implica-
For each decision, the paper will generally follow tions for what happens to the size of the illicit market,
a similar structure: Why is this an important factor, but also for the economic opportunities in the licit

CONTACT Beau Kilmer [email protected] RAND Drug Policy Research Center, 1776 Main St., Santa Monica, CA 94607
This article has been republished with minor changes. These changes do not impact the academic content of the article.
© 2019 Taylor & Francis Group, LLC.
2 B. KILMER

market. If licensed growers make a serious investment Profit motive

to grow in the licit market and the wholesale prices
Jurisdictions considering legalization need to decide
collapse, some of the producers – especially the smaller
whether to allow profit-maximizing firms to enter the
ones – may find it unprofitable to operate. Indeed,
market. It is unclear how legalization will play out and
some may go bankrupt and end up worse off than if
allowing business and their lobbyists to gain power will
they had not entered the cannabis business in the first
make it more difficult to make course corrections as the
place. There is already anecdotal evidence of this hap-
industry develops. Allowing innovative firms will lead
pening in Washington, where license values are drop-
ping and it is estimated that only about half of the to a proliferation of new products which could improve
licensed canopy allocation for production is being consumer welfare over other more restrictive models.
used (12). On the other hand, Pareto’s Law is in effect when it
Initially, Uruguay limited its two licensed produ- comes to cannabis: It is the daily and near-daily canna-
cers to grow no more than 4 metric tons, but this bis users which account for about 20% of past year
approach is not the norm. Except for Washington, users and about 80% of expenditures (15). To be profit-
none of the US states allowing commercial production able, most firms will need to maintain and encourage
set a cap on the total amount of cannabis (or THC) heavy use which could have serious implications for
that can be produced and sold in the licit market. rates of cannabis use disorder and other public health
(Washington initially limited production to 2 million outcomes (16).
square feet of canopy, but this cap was eventually Much of the cannabis debate in the US is focused on
lifted and now it is reported that the state now a false dichotomy of keeping supply prohibited or “reg-
licensed more than 12 million square feet; but as ulating cannabis like alcohol.” Figure 1 displays several
noted, not all of it is being used.) Canada has licensed alternatives to status quo supply prohibition, showing
more than 120 producers for its non-medical market that there are many middle-ground options jurisdic-
and has not formally limited production (13); how- tions could pursue, ranging from home production to
ever, their model allows each province and territory to government monopoly to allowing socially responsible
control the wholesale and retail markets which, in businesses that do not exclusively focus on profit (3,17).
essence, gives each government the power to control Cautious jurisdictions may want to consider some of
how much can be sold at the retail level and at what these other approaches before embracing the commer-
price (14). cial, profit-maximization model. It is also the case that
So far, jurisdictions allowing non-medical retail jurisdictions could choose different options for differ-
cannabis sales limit production to domestic sources. ent market levels (e.g., for-profit production and state-
If this changes and importation of cannabis produced controlled retail stores; also see 18).
in other countries is allowed, this will accelerate the While most of the jurisdictions in the US have gone
price decline and dramatically change the cannabis- the commercial route, both Vermont and Washington,
related economic opportunities in the importing and DC have limited supply to home grows and gifting.
exporting countries. Canada’s new model is a hybrid where the federal

Figure 1. Twelve alternatives to status quo prohibition of cannabis supply.

Source: Caulkins and Kilmer (17)
 THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 3

government licenses producers (most are for profit and and as discussed earlier, most profit-maximizing firms
some are publicly traded), and the provincial govern- will focus on creating and nurturing heavy users. While
ments serve as the sole wholesaler, allowing the state to an advantage of the state monopoly approach is that the
control products and prices if it wishes. Some provinces government can control advertising, that does not
are also limiting retail sales to government-run stores. mean it will. In the US, many government agencies
Outside of the home-grow only models, Uruguay heavily market state-sponsored lotteries to boost reven-
has imposed the most restrictive legalization model to ues (26), and the Liquor Control Board of Ontario –
date: Adults must register with the government to one of the world’s largest buyers and suppliers of alco-
obtain legal cannabis and must choose from one of hol – “is widely regarded as the leader in liquor retail-
three supply options: produce at home; join ing and marketing” (27).
a cannabis co-op, or purchase from participating phar- Jurisdictions have to choose whether they want to
macies (19–21). Only two firms are permitted to pro- allow advertising, and if so, which kinds. Uruguay has
duce cannabis for the pharmacies and the state banned all advertising while US states allow it. Indeed,
determines the price and product availability. there are questions about how much this advertising
can be limited in the US because of its commercial free-
speech doctrine. Currently, US states typically impose
Power to regulate
some constraints (e.g., cannot target ads in places
The type of agency or agencies tasked with regulating where >30% of the viewers are under 21, no cartoons
and/or enforcing the regulations in the new legal on packages), but it is very difficult to control what
regime could have profound consequences for health happens on social media. Canada seems to be some-
and other outcomes. Government agencies can have where in the middle with its requirements for plain
very different goals and approaches to accomplishing packaging and mandatory health warnings (28).
them (22). For example, giving the regulatory authority
to a public health agency might lead to more of a focus
on health outcomes than if the liquor control commis-
Prevention and treatment
sion is tasked with this authority (and largely treats
cannabis like alcohol products). Of course, this does Legalizing jurisdictions will need to decide whether to
not mean that non-health specific agencies do not care devote additional resources to prevention and treatment
about health outcomes. services, and if so, when will these funds be made avail-
In Colorado, the Department of Revenue was charged able. Those hoping to use cannabis tax revenues to fund
with regulating the new market while in Oregon it was the these activities may be waiting for a significant amount of
state Liquor Control Commission. In Canada, the federal time before significant resources are made available to
health agency is regulating the licensed producers, and the them. In the case of prevention, health-focused jurisdic-
provinces and territories are responsible for the lower tions will want to test new messaging strategies and
levels of the market. In some places like Uruguay, an deploy them before supply is legalized.
entirely new agency was created to regulate the market. After initially stumbling with the “Don’t be a Lab Rat”
Jurisdictions must also decide whether they want to campaign, the state of Colorado created a folksy “Good to
allow representatives of the cannabis industry to be Know” education campaign (29); early evaluations of the
involved in developing regulations. For example, latter suggest it achieved its goals of improving knowledge
Alaska’s Marijuana Control Board was “established as of the new laws and the health effects of cannabis (30).
a regulatory and quasi-judicial agency for the control of California also filled the airwaves with ads about the
the cultivation, manufacture and sale of marijuana in the dangers of driving under the influence of cannabis in
state” includes five members, one of which is currently the days before retail stores opened in January 2018 (31).
from the industry (23). While industry expertise can be Prevention is about more than developing commu-
insightful, its direct involvement in decision-making nity and/or school-based campaigns; it is also about
increases the risk of regulatory capture. preventing access. All legalizing jurisdictions to date
have created minimum age requirements, and many
jurisdictions are conducting undercover buys to verify
Promotion compliance (also referred to as controlled purchasing
If retail sales are allowed, there will be great incentives programs). Limiting days and hours of operation have
for firms to advertise and build their brands. been important for preventing access to alcohol and
Advertising can increase consumption (e.g., 24,25) this will likely apply to cannabis (4).
4 B. KILMER

Policing and enforcement community corrections are ordered to abstain from alco-
hol (which is legal for the rest of the population 21 years
One argument made for legalizing cannabis is that it
and older), but this is often because alcohol consumption
will reduce the time and effort law enforcement officials
was believed to be related to the offense.
spend on cannabis offenses. This would also decrease
Penalties for driving under the influence of cannabis
the number of people arrested for cannabis offenses,
are a contentious issue, especially since it is difficult to
many of whom then must confront the collateral con-
determine if a driver is under the influence of cannabis.
sequences of being arrested or convicted a drug offense
While the bulk of the research suggests that driving under
(32). Given the well documented racial and ethnic dis-
the influence of alcohol is more dangerous than driving
parities in cannabis-related offenses (e.g., 33),
under the influence of cannabis, driving under the influ-
a reduction in arrests could have important implica-
ence of cannabis is still more dangerous than driving
tions for social equity outcomes.
sober; further, the bulk of the research suggests that
Legalization will not eliminate police-related canna-
drivers under the influence of both alcohol and cannabis
bis contacts (e.g., there will still be arrests for driving
are reported to be much more likely to get in an accident
under the influence of cannabis, underage possession,
(16). Some researchers argue that because the risks of
public consumption, illicit growing). In fact, if
driving under the influence of cannabis alone are so
a jurisdiction is committed to reducing the size of the
much lower than they are for alcohol, the penalty for the
illicit market as quickly as possible, it may seek to
former should not be a criminal offense (36).
significantly ramp up enforcement against unlicensed
To date, every jurisdiction that has legalized still
producers and sellers. Thus, an important choice con-
prohibits driving under the influence of cannabis as
fronting jurisdictions is how much time and effort they
a criminal offense; however, the thresholds used to
want to devote to enforcing cannabis laws (including
determine if someone is under the influence is differ-
DUI) after a decision is made to legalize.
ent. For example, Colorado and Washington have
There is also a possibility that legalization could
a 5-nanogram of THC per milliliter of blood (ng/ml)
influence non-cannabis specific offenses, especially if
limit for drivers, but similar thresholds were not imple-
it affects the use of substances like alcohol which have
mented in Oregon or California. In Canada, they also
stronger connections to criminal activity. That said, it is
have instituted a 5 ng/ml THC threshold for a criminal
hard to predict the effect on crime as the evidence
offense, but there are also consequences for those with
about whether alcohol and cannabis are substitutes or
lower amounts of THC in the blood. Those with two or
complements is mixed, and it is unclear how applicable
more ng/ml but less than five could still be subject to
it will be in the post-legalization world (3,34,35).
a noncriminal offense that could lead to a fine of up to
$1000. Because of the risks associated with driving
under the influence of both alcohol and cannabis, it is
Penalties also a criminal offense to have a blood alcohol concen-
tration of 0.05% and more than 2.5 ng/ml of THC in
A related choice confronting legalizing jurisdictions is
the blood (37).
whether they will change the penalties for those con-
victed of a cannabis offense post-legalization. This will
have implications for social equity, health, and safety.
Prior criminal records
For example, should possession of cannabis by those
under age remain a criminal offense, or should it be Given the aforementioned racial and ethnic disparities
akin to a traffic citation? Another important choice will associated with cannabis prohibition, there is a growing
be the penalties for those producing or selling outside discussion about what jurisdictions should do about
of the licensed system. Will it just be a fine or would those who were convicted of cannabis-related offenses
a conviction lead to a criminal offense? Similar ques- that are now legal. This not only has wide-ranging
tions can be asked for those in the licensed system who implications because of the various collateral conse-
illegally divert product, but in that situation, there are quences associated with having a drug arrest or convic-
additional options: revoking or suspending the license. tion on your record, but it can also influence who gets
Another decision confronting legalizing jurisdictions is to participate in the newly legal market.
whether there will still be penalties for probationers and Jurisdictions not only have to decide whether to
parolees who are ordered to urinalyses and test positive remove or expunge these from individual’s criminal
for cannabis. In some jurisdictions, those subject to records, but they also have to make decisions about
 THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 5

which offenses: All cannabis offenses? Just possession? So far, none of the US states have banned certain
If jurisdictions do create a pathway to expungement, products from being sold in licensed non-medical
they must also decide how easy it will be to expunge stores. Uruguay, on the other hand, only allows a few
these offenses. Will the onus be on the individuals to go strains of flower to be sold in participating pharmacies.
through the process, or will the new legislation require When the stores opened in Canada in October 2018,
state officials to automatically delete these offenses only flower products and oils were allowed to be sold.
from their records? Health Canada is taking more time to develop regula-
The early legalization initiatives passed in the United tions for edibles and waxes.
States were largely silent when it came to addressing
those with criminal records for cannabis offenses. This
started to change when Oregon voters passed legaliza-
Potency
tion in 2014 and made it easier to seal previous con-
victions for cannabis offenses. Then in 2016, Closely related to the choice about product types is the
California’s initiative authorized “resentencing or dis- decision about whether to limit the potency of certain
missal and sealing of prior, eligible marijuana-related products. There is not a large literature on this, but
convictions” (38); however, the responsibility to peti- a review by Englund et al. (45), reported there were
tion the courts was still with the individuals who had a few studies finding higher-potency cannabis to be
been convicted. In September 2018, California’s associated with negative mental health outcomes.
Governor Brown signed a bill which changes this by They also cautioned:
streamlining and automating the process for what
could be more than 200,000 individuals (39). Other “[o]nly since 2009 have studies differentiated between
types of cannabis based on their THC content.
jurisdictions have implemented or are considering However, most of these studies have not measured
similar approaches (e.g., Denver, the entire state of THC and cannabidiol content directly but have used
Massachusetts). indirect measures of potency, such as strengths
reported in studies of cannabis from police seizures
or coffee shops, and have relied on self-report
measures.”
Product types
With respect to the high-potency concentrates, Kilmer
Jurisdictions considering legalization also have decisions (46), noted:
to make about the types of cannabis products allowed in
the market. Beginning with loosely regulated medical Even less is known about the health consequences of
cannabis markets, the number of cannabis products avail- cannabis concentrates. As late as 2015, there was no
scientific evidence about dabbing, which involves flash
able to consumers in commercial markets has prolifer-
vaporization of concentrated cannabis which can exceed
ated. For example, a new store in Oakland, California 75-percent THC (47). A 2017 study of college students
reports selling over 500 products (40) and data from concluded that butane-hash oil (BHO) use was associated
sales in Colorado and Washington suggest that flower with greater physiological dependence on cannabis, but
accounts for a decreasing share of cannabis products noted that “longitudinal research is needed to determine
purchased (41,42). While edibles and THC-infused bev- if cannabis users with higher levels of physiological
dependence seek out BHO and/or if BHO use increases
erages account for some of the non-flower market, the risk for physiological dependence (48).”
fastest growing segment of the markets are the extracts for
inhalation which include vaporizer pens, oils, and waxes. Of course, when we talk about potency we must also
We know very little about the health consequences – consider other cannabinoids (e.g., THC:CBD ratios; see
both the benefits and risks – of most of the products 45) and whether users are titrating their dosage (e.g., will
sold in retail stores in jurisdictions that have legalized someone who typically smokes a full joint at 5% THC
(43). Indeed, most of the health research cited in lega- consume only one-third of a joint if its 15% THC). There
lization debates is largely focused on studies conducted are few studies of titration and they seem to be limited to
on those who were smoking lower potency flower in Europe (see, e.g., 49, 50).
the 1980s and 1990s (44). Jurisdictions making deci- None of the legalization states in the US have imposed
sions about these products must also consider the con- potency limits on non-edible products. There is some
sequences of keeping some prohibited; will consumers variation with respect to edibles, with some state limiting
simply purchase banned in the unregulated illicit mar- edible doses at 10 mg of THC per serving and others
ket or from a neighboring jurisdiction (allowing the imposing a lower limit of 5 mg. Uruguay, which only
other place to pocket the tax revenue)? allows flower, initially only allowed product that was
6 B. KILMER

about 2% THC to be sold in the pharmacies, but this was tax retail price of cannabis after legalization (3,7,55). As
eventually increased to 9% THC. discussed earlier, there are several reasons to expect the
Canada’s legalization task force, which produced the production costs to plummet after legalization; how-
report that served as the basis for the legislation that ever, jurisdictions have several tools they could use to
was eventually passed (51), put a lot of emphasis on increase the retail price if they desire: Minimize com-
potency, recommending that regulators “Develop stra- petition (e.g., limit wholesale and/or retail market to
tegies to encourage consumption of less potent canna- the government), set the price, set a minimum price,
bis, including a price and tax scheme based on potency limit quantity discounts (e.g., by limiting the amount
to discourage purchase of high-potency products.” that can be purchased), levy taxes and fees, impose
costly regulations (e.g., thorough testing and labelling
regimes).
Purity
Currently, Uruguay is the only jurisdiction to date that
Just as jurisdictions will need to develop protocols for sets the price of the cannabis products sold and limits the
testing and labeling for cannabinoids, they will also amount individual can purchase at 10 g per week. Canada
have to make decisions about and develop protocols and all US jurisdictions limit the amount that can be
for the types of pesticides that can be used and other purchased in one transaction, require some type of testing
levels of impurities (e.g., mold, bacteria, metals). This (some more rigorous than others), and impose taxes. In
not only has health implications for consumers, but it many places, these are ad valorem taxes which are
can also create health risks for those working in the a function of price, but there are several ways to tax
cannabis industry (52,53). cannabis (3,55,56). Indeed, one of the limits of price-
Because of the federal prohibition in the US, the agency based taxes is that revenue will decline as the price falls,
generally tasked with developing regulations about pesti- unless there is a corresponding increase in consumption.
cides and tolerances (Environmental Protection Agency) An alternative approach is to tax cannabis as
has not weighed in on cannabis. This has left it up to a function of its THC content (3,55,57). This would
various state agencies to make these decisions about be similar to how the US federal government taxes
impurities, creating a patchwork of regulations (see e.g., liquor – as a function of its alcohol content. The 2019
54). In contrast, Canada’s federally regulated producers Canadian Budget proposes to a tax of $0.01 per milli-
are all subject to the same regulations, regardless of loca- gram of total THC for cannabis edibles, extracts (which
tion. In November 2018, the Canadian Ministry of Health will include oils), and topicals (58). One advantage of
(2018) published the list and limits of active ingredients, this approach is that tax revenue would not fall as
which can differ depending on whether the product is market prices decrease. If the THC tax was progressive
fresh cannabis and plants, dried cannabis, or cannabis oil. (i.e., the rate increases as the amount of THC in the
Jurisdictions will also have to decide whether certain product increases), it would make it easier for govern-
substances (e.g., alcohol and tobacco) can be mixed and ments to nudge consumers toward lower-potency pro-
sold with cannabis. Since the overall health effects of can- ducts. One could also imagine taxes based on THC:
nabis legalization will be shaped by what happens to the CBD ratios, or other combinations of chemicals.
consumption of alcohol, opioids, tobacco and other sub- If the testing and labeling regime is reliable in
stances (16), this decision could have important implica- a jurisdiction – and this is a big if – then taxing as
tions for health. So far, no jurisdiction has allowed cannabis a function of THC (or some other combination of canna-
products to be infused with alcohol or tobacco. In fact, binoids) should not be difficult. But as Kilmer (46), notes,
most places do not allow cannabis to be sold in stores that “if the testing regimes yields inconsistent results or the
sell alcohol or tobacco (Nova Scotia which sells both alco- system can be corrupted, this creates challenges for label-
hol and cannabis in the same state-run stores is a notable ing and levying THC taxes. In this situation, jurisdictions
exception). But with some alcohol and some tobacco- could consider using the company-stated THC level as the
related industries making significant investments in can- base for an alternative minimum tax.”
nabis producers in Canada, it is reasonable to ask how long
this prohibition on mixing products will last.
Preferences for licenses
If jurisdictions decide to legalize and license commer-
Price
cial activity, they will have to decide how to distribute
Many of the outcomes that get discussed in legalization those licenses: Like those applying for alcohol licenses?
debates – the size of the illicit market, consumption, tax Regular business licenses? To the highest bidders? Or
revenues, business profits – will be shaped by the post- should they give preferences to non-profits or for-
 THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 7

benefit corporations that are not driven solely by affect their bottom line. As noted above, cautious jur-
profit? To small businesses? Something else? As dis- isdictions seeking alternatives to prohibiting cannabis
cussed in the Profit Motive section, this could have supply may want to consider some of the middle-
important implications for the health and economic ground options presented in Figure 1.
consequences of legalization. Issues of permanency also apply to regulations and
With a goal of advancing social equity outcomes, product availability. Jurisdictions do not have to allow
there has been a movement in some jurisdictions to all cannabis products to be made available for purchase
give preferences for business licenses to those who have on Day 1; this is a choice. For example, those skeptical
been most harmed by cannabis prohibition (e.g., those about creating a market (and associated advertising) for
who live in communities where a disproportionate high-potency waxes could continue prohibiting them
number of arrests took place, those from certain with a sunset clause that will end the ban after a fixed
racial/ethnic groups, and/or those were previously con- period of time unless it is extended by the legislature.
victed of a cannabis offense). Oakland’s first retail store Some jurisdictions may also want to impose a similar
operated by an equity applicant opened in sunset clause with respect to on-premises consumption
November 2018 (40), San Francisco’s program is still since it is unclear what this means for overall impaired
being implemented (59), and the licensed retail stores driving (62); however, they will need to weigh this
are just opening in Massachusetts; thus, it is too early to against the problems associated with legalizing canna-
know whether these programs have achieved their goal bis but banning public consumption.
of building wealth and creating economic opportunities
for those preferred groups. As part of its medical can-
nabis program, the state of Ohio sought to make sure at Concluding thoughts
least 15% of the licenses went to minority-owned firms; Creating a new legal regime for cannabis supply is
however, this provision was legally challenged and complex. This article highlights 14 of the main choices;
a judge recently ruled it unconstitutional (60). there are obviously others. The bottom line is that
Whether this decision is upheld remains to be seen, jurisdictions have many options and they should not
but it highlights one challenge those developing social feel as if the Colorado and Washington models that
equity programs may need to overcome. have been replicated in some U.S. states are the only
Another potential challenge is whether those groups approaches for implementing an alternative to cannabis
receiving preferences for licenses have access to capital supply prohibition.
and other forms of business assistance to be successful These 14 Ps should also serve as a warning for analysts
in this industry. In California’s new program, up to conducting research on legalization. Using a simple bin-
$10 million will be dedicated to helping equity appli- ary variable indicating whether a jurisdiction has lega-
cants, including grants for startup and ongoing costs. lized or not in a standard differences-in-differences
Of course, when thinking about these programs as framework is not only crude, but it could lead to incor-
economic engines in certain communities, one must rect inferences if the jurisdictions have made different
also consider what the price drops will mean for the choices about these factors (63). Researchers must also
economic viability of those given preferred licenses. consider that states will likely adjust regulations over
A complementary or alternative approach would be to time, which could have important implications for
impose a THC tax that would not be as sensitive to health, safety, and/or social equity.
price drops and dedicate some of that revenue to evi-
dence-based programs that can improve economic
opportunities for groups and/or communities dispro- Financial disclosures
portionately affected by cannabis prohibition. The price The author reports no relevant financial conflicts.
drop could also be mitigated by allowing the govern-
ment to sell the product and/or set the price (61).
Funding

Permanency National Institute on Drug Abuse (R01DA040924).

None of the changes made to cannabis policy need be

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