Assessing How Marijuana Legalization in California Could Influence Marijuana Consumption and Public Budgets
Legalizing marijuana in California would lead to a major decline in the pretax price, but the price for consumers will depend heavily on taxes, the regulatory regime structure, and how taxes and regulations are enforced. The lower price and nonprice effects will increase consumption, but it is unclear by how much. There is much uncertainty about the effect on public budgets; even minor changes in assumptions lead to major differences in outcomes.
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