Can Legal Weed Win?: The Blunt Realities of Cannabis Economics

by Robin Goldstein, Daniel Sumner

Overview

Two economists take readers on a tour of the economics of legal and illegal weed, showing where cannabis regulation has gone wrong and how it could do better.

Cannabis "legalization" hasn't lived up to the hype. Across North America, investors are reeling, tax collections are below projections, and people are pointing fingers. On the business side, companies have shut down, farms have failed, workers have lost their jobs, and consumers face high prices. Why has legal weed failed to deliver on many of its promises? Can Legal Weed Win? takes on the euphoric claims with straight dope and a full dose of economic reality.

This book delivers the unadulterated facts about the new legal segment of one of the world's oldest industries. In witty, accessible prose, economists Robin Goldstein and Daniel Sumner take readers on a whirlwind tour of the economic past, present, and future of legal and illegal weed. Drawing upon reams of data and their own experience working with California cannabis regulators since 2016, Goldstein and Sumner explain why many cannabis businesses and some aspects of legalization fail to measure up, while others occasionally get it right. Their stories stretch from before America's first medical weed dispensaries opened in 1996 through the short-term boom in legal consumption that happened during COVID-19 lockdowns. Can Legal Weed Win? is packed with unexpected insights about how cannabis markets can thrive, how regulators get the laws right or wrong, and what might happen to legal and illegal markets going forward.

Product Details

ISBN-13:	9780520397378
Publisher:	University of California Press
Publication date:	09/19/2023
Edition description:	First Edition
Pages:	232
Product dimensions:	5.50(w) x 8.25(h) x 0.80(d)

About the Author

Robin Goldstein is an economist and author of The Wine Trials, the controversial exposé of wine snobbery that became the world's best-selling guide to cheap wine. He is Director of the Cannabis Economics Group in the Department of Agricultural and Resource Economics at the University of California, Davis. He has an AB from Harvard University, a JD from Yale Law School, and a PhD in economics from the University of Bordeaux.
 
Daniel Sumner is Frank H. Buck, Jr. Distinguished Professor of Agricultural and Resource Economics at the University of California, Davis. He grew up on a California fruit farm, served on the president's Council of Economic Advisers, and was Assistant Secretary of Economics at the US Department of Agriculture before joining the UC Davis faculty. He has a BS from Cal Poly and a PhD in economics from the University of Chicago.

Table of Contents

Contents

Preface: Fear and Stoning in Las Vegas
Acknowledgments

1 We Call It Weed
2 Legal versus Illegal: A Market Battle
3 Prices Get High
4 We Ask Our Data: Where’s the Cheapest Legal Weed?
5 California Dreamin’
6 Sabrina’s Story
7 Legal Weed in 2050
8 How to Survive Legalization
Conclusion: Five Pipe Dreams about Legal Weed

Bibliography
Index

Editorial Reviews

"Explains how burdensome licensing requirements, regulations, and taxes have frustrated plans to displace the black market."

Reason

"Explains how burdensome licensing requirements, regulations, and taxes have frustrated plans to displace the black market."

Reason

05/30/2022

In this lucid and pragmatic analysis, U.C. Davis economists Goldstein (The Wine Trials) and Summer extinguish overheated predictions about the potential size and profits of the legal marijuana market. Claiming that many investors “have lost most of the money they ever invested in weed,” the authors examine the forces working against legal marijuana, including the persistence of the illegal retail market, where prices are as much as 50% lower; burdensome regulations and compliance standards, including child-proof packaging, safety and potency tests, and safe waste disposal protocols; and long waiting periods for expensive state and local licenses. Throughout, Goldstein and Summer debunk urban legends and offer counterintuitive advice, claiming, for instance, that the psychoactive differences between Cannabis sativa and Cannabis indica are hard to distinguish (despite budtenders’ claims to the contrary), and that national legalization (which they predict will happen within 30 years) will put many existing retailers in high-priced and strictly regulated states like Massachusetts and California out of business by increasing interstate competition and lowering retail markups. The authors’ practical advice for growers, retailers, and investors includes advocating for local standards to be applied to out-of-state weed and cultivating the reputation of locally grown marijuana. Jargon-free and data-rich, this is a clear-eyed analysis of a hazy market. (June)

Publishers Weekly

Economists Goldstein and Sumner argue that government bureaucracy has made legal pot expensive to grow and sell, incentivizing illegal operations instead. Legal weed, their punny, breezy book shows, can only win once 'legal' isn’t an anticompetitive word.

Bloomberg Businessweek

"Written in a fun, witty tone that makes reading about finances more engaging than ever."

CBD Oracle

"An excellent primer on the state of the cannabis industry in America today."

Jacobin