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The American Journal of Drug and Alcohol AbuseEncompassing All Addictive Disorders

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How will cannabis legalization affect health safetyand social equity outcomes It largely depends onthe 14 Ps

Beau Kilmer

To cite this article Beau Kilmer (2019) How will cannabis legalization affect health safetyand social equity outcomes It largely depends on the 14 Ps The American Journal of Drug andAlcohol Abuse DOI 1010800095299020191611841

To link to this article httpsdoiorg1010800095299020191611841

Published online 02 Jul 2019

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REVIEW

How will cannabis legalization affect health safety and social equity outcomesIt largely depends on the 14 PsBeau Kilmer

RAND Drug Policy Research Center Santa Monica CA USA

ABSTRACTJurisdictions considering or implementing alternatives to cannabis supply prohibition will con-front several decisions that will influence health safety and social equity outcomes This essayhighlights 14 of these design considerations which all conveniently begin with the letter P 1)Production 2) Profit motive 3) Power to regulate 4) Promotion 5) Prevention and treatment 6)Policing and enforcement 7) Penalties 8) Prior criminal records 9) Product types 10) Potency 11)Purity 12) Price 13) Preferences for licenses and 14) Permanency For each factor the paperexplains why it is important describes the various approaches and highlights how some of thejurisdictions that have legalized have addressed these choices The primary audiences are decisionmakers considering alternatives to prohibiting cannabis supply and analysts making projections orconducting evaluations of these changes

ARTICLE HISTORYReceived 16 December 2018Revised 18 April 2019Accepted 23 April 2019

KEYWORDSCannabis legalizationhealth safety social equity

Introduction

Canada Uruguay and 11 jurisdictions in the UnitedStates have removed the prohibition on cannabis andhave legalized supply for adults This is very differentfrom the more common approach known as ldquodecrimi-nalizationrdquo which typically removes the criminal penal-ties for possessing small amounts but keeps supplya criminal offense Many of these jurisdictions allowlarge-scale production and retail sales but this is notthe only way to legalize cannabis Those considering orimplementing alternatives to cannabis supply prohibi-tion will confront several decisions that will influencehealth safety and social equity outcomes

This essay highlights 14 of these design considerationswhich all conveniently begin with the letter P It builds onprevious efforts to highlight the various supply architec-tures and regulatory decisions surrounding cannabis lega-lization (eg 1234) and two publications using a similaralliterative framework (56) The primary audiences aredecision makers considering alternatives to prohibitingcannabis supply and analysts making projections or con-ducting evaluations of these changes

The 14 Ps

For each decision the paper will generally followa similar structure Why is this an important factor

what are the various approaches and highlight howsome of the jurisdictions that have legalized haveaddressed these choices

Production

The cost of producing cannabis will plummet withlegalization (7) Removing the prohibition meansproducers no longer need to hide or be compensatedfor their risk of arrest or incarceration (8) Thesecosts will further decline if governments allow pro-ducers to compete and grow on industrial-sized out-door farms (9) We see price declines happening nowin Colorado where the average price for a pound ofhigh-potency cannabis in the licensed wholesale mar-ket declined more than 60 from January 2015 toOctober 2018 from $2007 to $759 (10) Some suggestthe wholesale price drop in Oregon has been evenmore severe (eg 11)

How quickly the wholesale prices decline willdepend on how much cannabis is allowed to be pro-duced and the regulations imposed on producersJurisdictions could be strategic and control the amountof cannabis (or THC) produced or they could simplygive production licenses to anyone who applies andpasses a background check This not only has implica-tions for what happens to the size of the illicit marketbut also for the economic opportunities in the licit

CONTACT Beau Kilmer kilmerrandorg RAND Drug Policy Research Center 1776 Main St Santa Monica CA 94607This article has been republished with minor changes These changes do not impact the academic content of the article

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSEhttpsdoiorg1010800095299020191611841

copy 2019 Taylor amp Francis Group LLC

market If licensed growers make a serious investmentto grow in the licit market and the wholesale pricescollapse some of the producers ndash especially the smallerones ndash may find it unprofitable to operate Indeedsome may go bankrupt and end up worse off than ifthey had not entered the cannabis business in the firstplace There is already anecdotal evidence of this hap-pening in Washington where license values are drop-ping and it is estimated that only about half of thelicensed canopy allocation for production is beingused (12)

Initially Uruguay limited its two licensed produ-cers to grow no more than 4 metric tons but thisapproach is not the norm Except for Washingtonnone of the US states allowing commercial productionset a cap on the total amount of cannabis (or THC)that can be produced and sold in the licit market(Washington initially limited production to 2 millionsquare feet of canopy but this cap was eventuallylifted and now it is reported that the state nowlicensed more than 12 million square feet but asnoted not all of it is being used) Canada has licensedmore than 120 producers for its non-medical marketand has not formally limited production (13) how-ever their model allows each province and territory tocontrol the wholesale and retail markets which inessence gives each government the power to controlhow much can be sold at the retail level and at whatprice (14)

So far jurisdictions allowing non-medical retailcannabis sales limit production to domestic sourcesIf this changes and importation of cannabis producedin other countries is allowed this will accelerate theprice decline and dramatically change the cannabis-related economic opportunities in the importing andexporting countries

Profit motive

Jurisdictions considering legalization need to decidewhether to allow profit-maximizing firms to enter themarket It is unclear how legalization will play out andallowing business and their lobbyists to gain power willmake it more difficult to make course corrections as theindustry develops Allowing innovative firms will leadto a proliferation of new products which could improveconsumer welfare over other more restrictive modelsOn the other hand Paretorsquos Law is in effect when itcomes to cannabis It is the daily and near-daily canna-bis users which account for about 20 of past yearusers and about 80 of expenditures (15) To be profit-able most firms will need to maintain and encourageheavy use which could have serious implications forrates of cannabis use disorder and other public healthoutcomes (16)

Much of the cannabis debate in the US is focused ona false dichotomy of keeping supply prohibited or ldquoreg-ulating cannabis like alcoholrdquo Figure 1 displays severalalternatives to status quo supply prohibition showingthat there are many middle-ground options jurisdic-tions could pursue ranging from home production togovernment monopoly to allowing socially responsiblebusinesses that do not exclusively focus on profit (317)Cautious jurisdictions may want to consider some ofthese other approaches before embracing the commer-cial profit-maximization model It is also the case thatjurisdictions could choose different options for differ-ent market levels (eg for-profit production and state-controlled retail stores also see 18)

While most of the jurisdictions in the US have gonethe commercial route both Vermont and WashingtonDC have limited supply to home grows and giftingCanadarsquos new model is a hybrid where the federal

Figure 1 Twelve alternatives to status quo prohibition of cannabis supplySource Caulkins and Kilmer (17)

2 B KILMER

government licenses producers (most are for profit andsome are publicly traded) and the provincial govern-ments serve as the sole wholesaler allowing the state tocontrol products and prices if it wishes Some provincesare also limiting retail sales to government-run stores

Outside of the home-grow only models Uruguayhas imposed the most restrictive legalization model todate Adults must register with the government toobtain legal cannabis and must choose from one ofthree supply options produce at home joina cannabis co-op or purchase from participating phar-macies (19ndash21) Only two firms are permitted to pro-duce cannabis for the pharmacies and the statedetermines the price and product availability

Power to regulate

The type of agency or agencies tasked with regulatingandor enforcing the regulations in the new legalregime could have profound consequences for healthand other outcomes Government agencies can havevery different goals and approaches to accomplishingthem (22) For example giving the regulatory authorityto a public health agency might lead to more of a focuson health outcomes than if the liquor control commis-sion is tasked with this authority (and largely treatscannabis like alcohol products) Of course this doesnot mean that non-health specific agencies do not careabout health outcomes

In Colorado the Department of Revenue was chargedwith regulating the newmarket while in Oregon it was thestate Liquor Control Commission In Canada the federalhealth agency is regulating the licensed producers and theprovinces and territories are responsible for the lowerlevels of the market In some places like Uruguay anentirely new agency was created to regulate the market

Jurisdictions must also decide whether they want toallow representatives of the cannabis industry to beinvolved in developing regulations For exampleAlaskarsquos Marijuana Control Board was ldquoestablished asa regulatory and quasi-judicial agency for the control ofthe cultivation manufacture and sale of marijuana in thestaterdquo includes five members one of which is currentlyfrom the industry (23) While industry expertise can beinsightful its direct involvement in decision-makingincreases the risk of regulatory capture

Promotion

If retail sales are allowed there will be great incentivesfor firms to advertise and build their brandsAdvertising can increase consumption (eg 2425)

and as discussed earlier most profit-maximizing firmswill focus on creating and nurturing heavy users Whilean advantage of the state monopoly approach is that thegovernment can control advertising that does notmean it will In the US many government agenciesheavily market state-sponsored lotteries to boost reven-ues (26) and the Liquor Control Board of Ontario ndashone of the worldrsquos largest buyers and suppliers of alco-hol ndash ldquois widely regarded as the leader in liquor retail-ing and marketingrdquo (27)

Jurisdictions have to choose whether they want toallow advertising and if so which kinds Uruguay hasbanned all advertising while US states allow it Indeedthere are questions about how much this advertisingcan be limited in the US because of its commercial free-speech doctrine Currently US states typically imposesome constraints (eg cannot target ads in placeswhere gt30 of the viewers are under 21 no cartoonson packages) but it is very difficult to control whathappens on social media Canada seems to be some-where in the middle with its requirements for plainpackaging and mandatory health warnings (28)

Prevention and treatment

Legalizing jurisdictions will need to decide whether todevote additional resources to prevention and treatmentservices and if so when will these funds be made avail-able Those hoping to use cannabis tax revenues to fundthese activities may be waiting for a significant amount oftime before significant resources are made available tothem In the case of prevention health-focused jurisdic-tions will want to test new messaging strategies anddeploy them before supply is legalized

After initially stumbling with the ldquoDonrsquot be a Lab Ratrdquocampaign the state of Colorado created a folksy ldquoGood toKnowrdquo education campaign (29) early evaluations of thelatter suggest it achieved its goals of improving knowledgeof the new laws and the health effects of cannabis (30)California also filled the airwaves with ads about thedangers of driving under the influence of cannabis inthe days before retail stores opened in January 2018 (31)

Prevention is about more than developing commu-nity andor school-based campaigns it is also aboutpreventing access All legalizing jurisdictions to datehave created minimum age requirements and manyjurisdictions are conducting undercover buys to verifycompliance (also referred to as controlled purchasingprograms) Limiting days and hours of operation havebeen important for preventing access to alcohol andthis will likely apply to cannabis (4)

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 3

Policing and enforcement

One argument made for legalizing cannabis is that itwill reduce the time and effort law enforcement officialsspend on cannabis offenses This would also decreasethe number of people arrested for cannabis offensesmany of whom then must confront the collateral con-sequences of being arrested or convicted a drug offense(32) Given the well documented racial and ethnic dis-parities in cannabis-related offenses (eg 33)a reduction in arrests could have important implica-tions for social equity outcomes

Legalization will not eliminate police-related canna-bis contacts (eg there will still be arrests for drivingunder the influence of cannabis underage possessionpublic consumption illicit growing) In fact ifa jurisdiction is committed to reducing the size of theillicit market as quickly as possible it may seek tosignificantly ramp up enforcement against unlicensedproducers and sellers Thus an important choice con-fronting jurisdictions is how much time and effort theywant to devote to enforcing cannabis laws (includingDUI) after a decision is made to legalize

There is also a possibility that legalization couldinfluence non-cannabis specific offenses especially ifit affects the use of substances like alcohol which havestronger connections to criminal activity That said it ishard to predict the effect on crime as the evidenceabout whether alcohol and cannabis are substitutes orcomplements is mixed and it is unclear how applicableit will be in the post-legalization world (33435)

Penalties

A related choice confronting legalizing jurisdictions iswhether they will change the penalties for those con-victed of a cannabis offense post-legalization This willhave implications for social equity health and safetyFor example should possession of cannabis by thoseunder age remain a criminal offense or should it beakin to a traffic citation Another important choice willbe the penalties for those producing or selling outsideof the licensed system Will it just be a fine or woulda conviction lead to a criminal offense Similar ques-tions can be asked for those in the licensed system whoillegally divert product but in that situation there areadditional options revoking or suspending the license

Another decision confronting legalizing jurisdictions iswhether there will still be penalties for probationers andparolees who are ordered to urinalyses and test positivefor cannabis In some jurisdictions those subject to

community corrections are ordered to abstain from alco-hol (which is legal for the rest of the population 21 yearsand older) but this is often because alcohol consumptionwas believed to be related to the offense

Penalties for driving under the influence of cannabisare a contentious issue especially since it is difficult todetermine if a driver is under the influence of cannabisWhile the bulk of the research suggests that driving underthe influence of alcohol is more dangerous than drivingunder the influence of cannabis driving under the influ-ence of cannabis is still more dangerous than drivingsober further the bulk of the research suggests thatdrivers under the influence of both alcohol and cannabisare reported to be much more likely to get in an accident(16) Some researchers argue that because the risks ofdriving under the influence of cannabis alone are somuch lower than they are for alcohol the penalty for theformer should not be a criminal offense (36)

To date every jurisdiction that has legalized stillprohibits driving under the influence of cannabis asa criminal offense however the thresholds used todetermine if someone is under the influence is differ-ent For example Colorado and Washington havea 5-nanogram of THC per milliliter of blood (ngml)limit for drivers but similar thresholds were not imple-mented in Oregon or California In Canada they alsohave instituted a 5 ngml THC threshold for a criminaloffense but there are also consequences for those withlower amounts of THC in the blood Those with two ormore ngml but less than five could still be subject toa noncriminal offense that could lead to a fine of up to$1000 Because of the risks associated with drivingunder the influence of both alcohol and cannabis it isalso a criminal offense to have a blood alcohol concen-tration of 005 and more than 25 ngml of THC inthe blood (37)

Prior criminal records

Given the aforementioned racial and ethnic disparitiesassociated with cannabis prohibition there is a growingdiscussion about what jurisdictions should do aboutthose who were convicted of cannabis-related offensesthat are now legal This not only has wide-rangingimplications because of the various collateral conse-quences associated with having a drug arrest or convic-tion on your record but it can also influence who getsto participate in the newly legal market

Jurisdictions not only have to decide whether toremove or expunge these from individualrsquos criminalrecords but they also have to make decisions about

4 B KILMER

which offenses All cannabis offenses Just possessionIf jurisdictions do create a pathway to expungementthey must also decide how easy it will be to expungethese offenses Will the onus be on the individuals to gothrough the process or will the new legislation requirestate officials to automatically delete these offensesfrom their records

The early legalization initiatives passed in the UnitedStates were largely silent when it came to addressingthose with criminal records for cannabis offenses Thisstarted to change when Oregon voters passed legaliza-tion in 2014 and made it easier to seal previous con-victions for cannabis offenses Then in 2016Californiarsquos initiative authorized ldquoresentencing or dis-missal and sealing of prior eligible marijuana-relatedconvictionsrdquo (38) however the responsibility to peti-tion the courts was still with the individuals who hadbeen convicted In September 2018 CaliforniarsquosGovernor Brown signed a bill which changes this bystreamlining and automating the process for whatcould be more than 200000 individuals (39) Otherjurisdictions have implemented or are consideringsimilar approaches (eg Denver the entire state ofMassachusetts)

Product types

Jurisdictions considering legalization also have decisionsto make about the types of cannabis products allowed inthe market Beginning with loosely regulated medicalcannabis markets the number of cannabis products avail-able to consumers in commercial markets has prolifer-ated For example a new store in Oakland Californiareports selling over 500 products (40) and data fromsales in Colorado and Washington suggest that floweraccounts for a decreasing share of cannabis productspurchased (4142) While edibles and THC-infused bev-erages account for some of the non-flower market thefastest growing segment of the markets are the extracts forinhalation which include vaporizer pens oils and waxes

We know very little about the health consequences ndashboth the benefits and risks ndash of most of the productssold in retail stores in jurisdictions that have legalized(43) Indeed most of the health research cited in lega-lization debates is largely focused on studies conductedon those who were smoking lower potency flower inthe 1980s and 1990s (44) Jurisdictions making deci-sions about these products must also consider the con-sequences of keeping some prohibited will consumerssimply purchase banned in the unregulated illicit mar-ket or from a neighboring jurisdiction (allowing theother place to pocket the tax revenue)

So far none of the US states have banned certainproducts from being sold in licensed non-medicalstores Uruguay on the other hand only allows a fewstrains of flower to be sold in participating pharmaciesWhen the stores opened in Canada in October 2018only flower products and oils were allowed to be soldHealth Canada is taking more time to develop regula-tions for edibles and waxes

Potency

Closely related to the choice about product types is thedecision about whether to limit the potency of certainproducts There is not a large literature on this buta review by Englund et al (45) reported there werea few studies finding higher-potency cannabis to beassociated with negative mental health outcomesThey also cautioned

ldquo[o]nly since 2009 have studies differentiated betweentypes of cannabis based on their THC contentHowever most of these studies have not measuredTHC and cannabidiol content directly but have usedindirect measures of potency such as strengthsreported in studies of cannabis from police seizuresor coffee shops and have relied on self-reportmeasuresrdquo

With respect to the high-potency concentrates Kilmer(46) noted

Even less is known about the health consequences ofcannabis concentrates As late as 2015 there was noscientific evidence about dabbing which involves flashvaporization of concentrated cannabis which can exceed75-percent THC (47) A 2017 study of college studentsconcluded that butane-hash oil (BHO) use was associatedwith greater physiological dependence on cannabis butnoted that ldquolongitudinal research is needed to determineif cannabis users with higher levels of physiologicaldependence seek out BHO andor if BHO use increasesrisk for physiological dependence (48)rdquo

Of course when we talk about potency we must alsoconsider other cannabinoids (eg THCCBD ratios see45) and whether users are titrating their dosage (eg willsomeone who typically smokes a full joint at 5 THCconsume only one-third of a joint if its 15 THC) Thereare few studies of titration and they seem to be limited toEurope (see eg 49 50)

None of the legalization states in the US have imposedpotency limits on non-edible products There is somevariation with respect to edibles with some state limitingedible doses at 10 mg of THC per serving and othersimposing a lower limit of 5 mg Uruguay which onlyallows flower initially only allowed product that was

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 5

about 2 THC to be sold in the pharmacies but this waseventually increased to 9 THC

Canadarsquos legalization task force which produced thereport that served as the basis for the legislation thatwas eventually passed (51) put a lot of emphasis onpotency recommending that regulators ldquoDevelop stra-tegies to encourage consumption of less potent canna-bis including a price and tax scheme based on potencyto discourage purchase of high-potency productsrdquo

Purity

Just as jurisdictions will need to develop protocols fortesting and labeling for cannabinoids they will alsohave to make decisions about and develop protocolsfor the types of pesticides that can be used and otherlevels of impurities (eg mold bacteria metals) Thisnot only has health implications for consumers but itcan also create health risks for those working in thecannabis industry (5253)

Because of the federal prohibition in the US the agencygenerally tasked with developing regulations about pesti-cides and tolerances (Environmental Protection Agency)has not weighed in on cannabis This has left it up tovarious state agencies to make these decisions aboutimpurities creating a patchwork of regulations (see eg54) In contrast Canadarsquos federally regulated producersare all subject to the same regulations regardless of loca-tion In November 2018 the CanadianMinistry of Health(2018) published the list and limits of active ingredientswhich can differ depending on whether the product isfresh cannabis and plants dried cannabis or cannabis oil

Jurisdictions will also have to decide whether certainsubstances (eg alcohol and tobacco) can be mixed andsold with cannabis Since the overall health effects of can-nabis legalization will be shaped by what happens to theconsumption of alcohol opioids tobacco and other sub-stances (16) this decision could have important implica-tions for health So far no jurisdiction has allowed cannabisproducts to be infused with alcohol or tobacco In factmost places do not allow cannabis to be sold in stores thatsell alcohol or tobacco (Nova Scotia which sells both alco-hol and cannabis in the same state-run stores is a notableexception) But with some alcohol and some tobacco-related industries making significant investments in can-nabis producers in Canada it is reasonable to ask how longthis prohibition on mixing products will last

Price

Many of the outcomes that get discussed in legalizationdebates ndash the size of the illicit market consumption taxrevenues business profits ndash will be shaped by the post-

tax retail price of cannabis after legalization (3755) Asdiscussed earlier there are several reasons to expect theproduction costs to plummet after legalization how-ever jurisdictions have several tools they could use toincrease the retail price if they desire Minimize com-petition (eg limit wholesale andor retail market tothe government) set the price set a minimum pricelimit quantity discounts (eg by limiting the amountthat can be purchased) levy taxes and fees imposecostly regulations (eg thorough testing and labellingregimes)

Currently Uruguay is the only jurisdiction to date thatsets the price of the cannabis products sold and limits theamount individual can purchase at 10 g per week Canadaand all US jurisdictions limit the amount that can bepurchased in one transaction require some type of testing(some more rigorous than others) and impose taxes Inmany places these are ad valorem taxes which area function of price but there are several ways to taxcannabis (35556) Indeed one of the limits of price-based taxes is that revenue will decline as the price fallsunless there is a corresponding increase in consumption

An alternative approach is to tax cannabis asa function of its THC content (35557) This wouldbe similar to how the US federal government taxesliquor ndash as a function of its alcohol content The 2019Canadian Budget proposes to a tax of $001 per milli-gram of total THC for cannabis edibles extracts (whichwill include oils) and topicals (58) One advantage ofthis approach is that tax revenue would not fall asmarket prices decrease If the THC tax was progressive(ie the rate increases as the amount of THC in theproduct increases) it would make it easier for govern-ments to nudge consumers toward lower-potency pro-ducts One could also imagine taxes based on THCCBD ratios or other combinations of chemicals

If the testing and labeling regime is reliable ina jurisdiction ndash and this is a big if ndash then taxing asa function of THC (or some other combination of canna-binoids) should not be difficult But as Kilmer (46) notesldquoif the testing regimes yields inconsistent results or thesystem can be corrupted this creates challenges for label-ing and levying THC taxes In this situation jurisdictionscould consider using the company-stated THC level as thebase for an alternative minimum taxrdquo

Preferences for licenses

If jurisdictions decide to legalize and license commer-cial activity they will have to decide how to distributethose licenses Like those applying for alcohol licensesRegular business licenses To the highest bidders Orshould they give preferences to non-profits or for-

6 B KILMER

benefit corporations that are not driven solely byprofit To small businesses Something else As dis-cussed in the Profit Motive section this could haveimportant implications for the health and economicconsequences of legalization

With a goal of advancing social equity outcomesthere has been a movement in some jurisdictions togive preferences for business licenses to those who havebeen most harmed by cannabis prohibition (eg thosewho live in communities where a disproportionatenumber of arrests took place those from certainracialethnic groups andor those were previously con-victed of a cannabis offense) Oaklandrsquos first retail storeoperated by an equity applicant opened inNovember 2018 (40) San Franciscorsquos program is stillbeing implemented (59) and the licensed retail storesare just opening in Massachusetts thus it is too early toknow whether these programs have achieved their goalof building wealth and creating economic opportunitiesfor those preferred groups As part of its medical can-nabis program the state of Ohio sought to make sure atleast 15 of the licenses went to minority-owned firmshowever this provision was legally challenged anda judge recently ruled it unconstitutional (60)Whether this decision is upheld remains to be seenbut it highlights one challenge those developing socialequity programs may need to overcome

Another potential challenge is whether those groupsreceiving preferences for licenses have access to capitaland other forms of business assistance to be successfulin this industry In Californiarsquos new program up to$10 million will be dedicated to helping equity appli-cants including grants for startup and ongoing costsOf course when thinking about these programs aseconomic engines in certain communities one mustalso consider what the price drops will mean for theeconomic viability of those given preferred licensesA complementary or alternative approach would be toimpose a THC tax that would not be as sensitive toprice drops and dedicate some of that revenue to evi-dence-based programs that can improve economicopportunities for groups andor communities dispro-portionately affected by cannabis prohibition The pricedrop could also be mitigated by allowing the govern-ment to sell the product andor set the price (61)

Permanency

None of the changes made to cannabis policy need bepermanent whether it is through ballot initiatives orthe more traditional legislative process however open-ing the market to profit-maximizing firms makes itharder to make any changes that could significantly

affect their bottom line As noted above cautious jur-isdictions seeking alternatives to prohibiting cannabissupply may want to consider some of the middle-ground options presented in Figure 1

Issues of permanency also apply to regulations andproduct availability Jurisdictions do not have to allowall cannabis products to be made available for purchaseon Day 1 this is a choice For example those skepticalabout creating a market (and associated advertising) forhigh-potency waxes could continue prohibiting themwith a sunset clause that will end the ban after a fixedperiod of time unless it is extended by the legislatureSome jurisdictions may also want to impose a similarsunset clause with respect to on-premises consumptionsince it is unclear what this means for overall impaireddriving (62) however they will need to weigh thisagainst the problems associated with legalizing canna-bis but banning public consumption

Concluding thoughts

Creating a new legal regime for cannabis supply iscomplex This article highlights 14 of the main choicesthere are obviously others The bottom line is thatjurisdictions have many options and they should notfeel as if the Colorado and Washington models thathave been replicated in some US states are the onlyapproaches for implementing an alternative to cannabissupply prohibition

These 14 Ps should also serve as a warning for analystsconducting research on legalization Using a simple bin-ary variable indicating whether a jurisdiction has lega-lized or not in a standard differences-in-differencesframework is not only crude but it could lead to incor-rect inferences if the jurisdictions have made differentchoices about these factors (63) Researchers must alsoconsider that states will likely adjust regulations overtime which could have important implications forhealth safety andor social equity

Financial disclosures

The author reports no relevant financial conflicts

Funding

National Institute on Drug Abuse (R01DA040924)

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THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 7

2 Rolles S Murkin G How to regulate cannabis a prac-tical guide Transform Drug Policy Foundation 2013

3 Caulkins JP Kilmer B Kleiman MA MacCoun RJMidgette G Oglesby P Pacula RL Reuter PHConsidering marijuana legalization insights forVermont and other jurisdictions Santa Monica (CA)Rand Corporation 2015 Report No RR-864

4 Pacula RL Kilmer B Wagenaar AC Chaloupka FJCaulkins JP Developing public health regulations formarijuana lessons from alcohol and tobacco AmJ Public Health 20141041021ndash28 doi102105AJPH2013301766

5 Kilmer B Policy designs for cannabis legalizationstarting with the eight Ps Am J Drug Alcohol Abuse201440259ndash61 doi103109009529902014894047

6 Kilmer B The ldquo10 Psrdquo of Marijuana LegalizationBerkeley Rev Latin Am Stud 20155455

7 Kilmer B Caulkins JP Pacula RL MacCoun RJReuter P Altered state assessing how marijuana lega-lization in California could influence marijuana con-sumption and public budgets Santa Monica (CA)RAND Corporation 2010

8 Reuter P Kleiman MA Risks and prices an economicanalysis of drug enforcement Crime Justice19867289ndash340 doi101086449116

9 Caulkins J Effects of prohibition enforcement and inter-diction on drug use In Quah Collins Atuesta BecerraCaulkins J Csete J Drucker E Felbab-Brown V et aleds Ending the drug wars report of the LSE ExpertGroup on the economics of drug policy 201416ndash24httpwwwlseacukideasAssetsDocumentsreportsLSE-IDEAS-Ending-the-Drug-Warspdf

10 Colorado Department of Revenue Current amp priorretail marijuana average market rates (Median marketprices) 2019 httpswwwcoloradogovpacificsitesdefaultfilesAMR_CurrentAndPriorRates_Jul2019pdf

11 Cannabis Benchmarks 2018 ldquoCannabis BenchmarksSpot Price Indicies The Big Four vs The USrdquoSeptember httpswwwcannabisbenchmarkscom

12 Kleiman M Hampsher S Davenport S Manning CHeussler L Interviews with cannabis licensees inWashington State New York BOTEC AnalysisForthcoming

13 Cherney MA Cannabis is now legal in Canada but potcompanies expect a rocky start MarketWatch 2018httpswwwmarketwatchcomstorycannabis-is-now-legal-in-canada-but-pot-companies-expect-a-rocky-start-2018-10-17

14 Government of Canada Canada Go Cannabis in theprovinces and territories Canada government ofCanada 2018a [accessed 2018 Oct 22 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsprovinces-territorieshtml

15 Kilmer B Everingham S Caulkins J Midgette GPacula R Reuter P Burns R et al What Americarsquosusers spend on illegal drugs 2000ndash2010 Prepared forthe Office of National Drug Control PolicyWashington (DC) RAND Corporation 2014

16 Caulkins JP Kilmer B Kleiman MA Marijuana legali-zation what everyone needs to know 2nd edNew York Oxford University Press 2016

17 Caulkins JP Kilmer B Considering marijuana legaliza-tion carefully insights for other jurisdictions fromanalysis for Vermont Addiction 2016Dec1112082ndash89 doi101111add13289

18 Wilkins C After the legalisation of cannabis the CannabisIncorporated Society (CIS) regulatory model for recrea-tional cannabis in New Zealand NZ Med J201612917ndash20

19 Cerdaacute M Kilmer B Uruguayrsquos middle-groundapproach to cannabis legalization Int J Drug Policy201742118ndash20 doi101016jdrugpo201702007

20 Pardo B Cannabis policy reforms in the Americasa comparative analysis of Colorado Washington andUruguay Int J Drug Policy 201425727ndash35doi101016jdrugpo201405010

21 Walsh J Ramsey G Uruguayrsquos drug policy majorinnovations major challenges WashingtonBrookings 2015 httpwww brookingsedu~mediaResearchFilesPapers201504global-drug-policyWalshndashUruguay-finalpdf

22 Wilson JQ Bureaucracy what government agencies doand why they do it New York (NY) Basic Books 1989

23 Alaska Department of Commerce Community andEconomic Development Marijuana control boardmembers 2019 httpswwwcommercealaskagovwebamcoMCBMembersaspx

24 Warner K Selling smoke cigarette advertising andpublic health Amer Public Health Association 1986

25 Saffer H Studying the effects of alcohol advertising onconsumption AlcoholHealth ResWorld 199620266ndash272

26 MacCoun RJ Reuter P Drug war heresies learningfrom other vices times and places CambridgeUniversity Press 2001

27 Bird MG The Rise of the Liquor Control Board ofOntario 1985-2009 Can Political Sci Rev 201041ndash17

28 Government of Canada Canada Go Regulations tosupport coming into force of the Cannabis ActCanada government of Canada 2018b [accessed 2018July 11 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsregulations-support-cannabis-acthtml

29 Ingold J To educate people about marijuana Coloradohealth officals tried ads with a radically friendly toneDid it work The denver post [Internet] 2018 httpswwwdenverpostcom20180122colorado-marijuana-education-advertising

30 Crawford K Colorado Department of Public Health ampEnvironment (CDPHE) Retail Marijuana EducationProgram 2017 annual reportDenver (CO)CDPHE 2018

31 Branan B Public safety agencies launch drugged drivingcampaign in advance of legalized marijuanaSacramento Bee 2017 httpswwwsacbeecomnewslocalarticle191881659html

32 National Inventory of Collateral Consequences ofConviction 2018 httpsniccccsgjusticecenterorg

33 Southern Poverty Law Center Alabamalsquos war on mar-ijuana assessing the fiscal and human toll on crimina-lization Montgomery (AL) Southern Poverty LawCenter 2018

34 Subbaraman M Substitution and complementarity ofalcohol and cannabis a review of the literature Subst

8 B KILMER

government licenses producers (most are for profit andsome are publicly traded) and the provincial govern-ments serve as the sole wholesaler allowing the state tocontrol products and prices if it wishes Some provincesare also limiting retail sales to government-run stores

Outside of the home-grow only models Uruguayhas imposed the most restrictive legalization model todate Adults must register with the government toobtain legal cannabis and must choose from one ofthree supply options produce at home joina cannabis co-op or purchase from participating phar-macies (19ndash21) Only two firms are permitted to pro-duce cannabis for the pharmacies and the statedetermines the price and product availability

Power to regulate

The type of agency or agencies tasked with regulatingandor enforcing the regulations in the new legalregime could have profound consequences for healthand other outcomes Government agencies can havevery different goals and approaches to accomplishingthem (22) For example giving the regulatory authorityto a public health agency might lead to more of a focuson health outcomes than if the liquor control commis-sion is tasked with this authority (and largely treatscannabis like alcohol products) Of course this doesnot mean that non-health specific agencies do not careabout health outcomes

In Colorado the Department of Revenue was chargedwith regulating the newmarket while in Oregon it was thestate Liquor Control Commission In Canada the federalhealth agency is regulating the licensed producers and theprovinces and territories are responsible for the lowerlevels of the market In some places like Uruguay anentirely new agency was created to regulate the market

Jurisdictions must also decide whether they want toallow representatives of the cannabis industry to beinvolved in developing regulations For exampleAlaskarsquos Marijuana Control Board was ldquoestablished asa regulatory and quasi-judicial agency for the control ofthe cultivation manufacture and sale of marijuana in thestaterdquo includes five members one of which is currentlyfrom the industry (23) While industry expertise can beinsightful its direct involvement in decision-makingincreases the risk of regulatory capture

Promotion

If retail sales are allowed there will be great incentivesfor firms to advertise and build their brandsAdvertising can increase consumption (eg 2425)

and as discussed earlier most profit-maximizing firmswill focus on creating and nurturing heavy users Whilean advantage of the state monopoly approach is that thegovernment can control advertising that does notmean it will In the US many government agenciesheavily market state-sponsored lotteries to boost reven-ues (26) and the Liquor Control Board of Ontario ndashone of the worldrsquos largest buyers and suppliers of alco-hol ndash ldquois widely regarded as the leader in liquor retail-ing and marketingrdquo (27)

Jurisdictions have to choose whether they want toallow advertising and if so which kinds Uruguay hasbanned all advertising while US states allow it Indeedthere are questions about how much this advertisingcan be limited in the US because of its commercial free-speech doctrine Currently US states typically imposesome constraints (eg cannot target ads in placeswhere gt30 of the viewers are under 21 no cartoonson packages) but it is very difficult to control whathappens on social media Canada seems to be some-where in the middle with its requirements for plainpackaging and mandatory health warnings (28)

Prevention and treatment

Legalizing jurisdictions will need to decide whether todevote additional resources to prevention and treatmentservices and if so when will these funds be made avail-able Those hoping to use cannabis tax revenues to fundthese activities may be waiting for a significant amount oftime before significant resources are made available tothem In the case of prevention health-focused jurisdic-tions will want to test new messaging strategies anddeploy them before supply is legalized

After initially stumbling with the ldquoDonrsquot be a Lab Ratrdquocampaign the state of Colorado created a folksy ldquoGood toKnowrdquo education campaign (29) early evaluations of thelatter suggest it achieved its goals of improving knowledgeof the new laws and the health effects of cannabis (30)California also filled the airwaves with ads about thedangers of driving under the influence of cannabis inthe days before retail stores opened in January 2018 (31)

Prevention is about more than developing commu-nity andor school-based campaigns it is also aboutpreventing access All legalizing jurisdictions to datehave created minimum age requirements and manyjurisdictions are conducting undercover buys to verifycompliance (also referred to as controlled purchasingprograms) Limiting days and hours of operation havebeen important for preventing access to alcohol andthis will likely apply to cannabis (4)

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 3

Policing and enforcement

One argument made for legalizing cannabis is that itwill reduce the time and effort law enforcement officialsspend on cannabis offenses This would also decreasethe number of people arrested for cannabis offensesmany of whom then must confront the collateral con-sequences of being arrested or convicted a drug offense(32) Given the well documented racial and ethnic dis-parities in cannabis-related offenses (eg 33)a reduction in arrests could have important implica-tions for social equity outcomes

Legalization will not eliminate police-related canna-bis contacts (eg there will still be arrests for drivingunder the influence of cannabis underage possessionpublic consumption illicit growing) In fact ifa jurisdiction is committed to reducing the size of theillicit market as quickly as possible it may seek tosignificantly ramp up enforcement against unlicensedproducers and sellers Thus an important choice con-fronting jurisdictions is how much time and effort theywant to devote to enforcing cannabis laws (includingDUI) after a decision is made to legalize

There is also a possibility that legalization couldinfluence non-cannabis specific offenses especially ifit affects the use of substances like alcohol which havestronger connections to criminal activity That said it ishard to predict the effect on crime as the evidenceabout whether alcohol and cannabis are substitutes orcomplements is mixed and it is unclear how applicableit will be in the post-legalization world (33435)

Penalties

A related choice confronting legalizing jurisdictions iswhether they will change the penalties for those con-victed of a cannabis offense post-legalization This willhave implications for social equity health and safetyFor example should possession of cannabis by thoseunder age remain a criminal offense or should it beakin to a traffic citation Another important choice willbe the penalties for those producing or selling outsideof the licensed system Will it just be a fine or woulda conviction lead to a criminal offense Similar ques-tions can be asked for those in the licensed system whoillegally divert product but in that situation there areadditional options revoking or suspending the license

Another decision confronting legalizing jurisdictions iswhether there will still be penalties for probationers andparolees who are ordered to urinalyses and test positivefor cannabis In some jurisdictions those subject to

community corrections are ordered to abstain from alco-hol (which is legal for the rest of the population 21 yearsand older) but this is often because alcohol consumptionwas believed to be related to the offense

Penalties for driving under the influence of cannabisare a contentious issue especially since it is difficult todetermine if a driver is under the influence of cannabisWhile the bulk of the research suggests that driving underthe influence of alcohol is more dangerous than drivingunder the influence of cannabis driving under the influ-ence of cannabis is still more dangerous than drivingsober further the bulk of the research suggests thatdrivers under the influence of both alcohol and cannabisare reported to be much more likely to get in an accident(16) Some researchers argue that because the risks ofdriving under the influence of cannabis alone are somuch lower than they are for alcohol the penalty for theformer should not be a criminal offense (36)

To date every jurisdiction that has legalized stillprohibits driving under the influence of cannabis asa criminal offense however the thresholds used todetermine if someone is under the influence is differ-ent For example Colorado and Washington havea 5-nanogram of THC per milliliter of blood (ngml)limit for drivers but similar thresholds were not imple-mented in Oregon or California In Canada they alsohave instituted a 5 ngml THC threshold for a criminaloffense but there are also consequences for those withlower amounts of THC in the blood Those with two ormore ngml but less than five could still be subject toa noncriminal offense that could lead to a fine of up to$1000 Because of the risks associated with drivingunder the influence of both alcohol and cannabis it isalso a criminal offense to have a blood alcohol concen-tration of 005 and more than 25 ngml of THC inthe blood (37)

Prior criminal records

Given the aforementioned racial and ethnic disparitiesassociated with cannabis prohibition there is a growingdiscussion about what jurisdictions should do aboutthose who were convicted of cannabis-related offensesthat are now legal This not only has wide-rangingimplications because of the various collateral conse-quences associated with having a drug arrest or convic-tion on your record but it can also influence who getsto participate in the newly legal market

Jurisdictions not only have to decide whether toremove or expunge these from individualrsquos criminalrecords but they also have to make decisions about

4 B KILMER

which offenses All cannabis offenses Just possessionIf jurisdictions do create a pathway to expungementthey must also decide how easy it will be to expungethese offenses Will the onus be on the individuals to gothrough the process or will the new legislation requirestate officials to automatically delete these offensesfrom their records

The early legalization initiatives passed in the UnitedStates were largely silent when it came to addressingthose with criminal records for cannabis offenses Thisstarted to change when Oregon voters passed legaliza-tion in 2014 and made it easier to seal previous con-victions for cannabis offenses Then in 2016Californiarsquos initiative authorized ldquoresentencing or dis-missal and sealing of prior eligible marijuana-relatedconvictionsrdquo (38) however the responsibility to peti-tion the courts was still with the individuals who hadbeen convicted In September 2018 CaliforniarsquosGovernor Brown signed a bill which changes this bystreamlining and automating the process for whatcould be more than 200000 individuals (39) Otherjurisdictions have implemented or are consideringsimilar approaches (eg Denver the entire state ofMassachusetts)

Product types

Jurisdictions considering legalization also have decisionsto make about the types of cannabis products allowed inthe market Beginning with loosely regulated medicalcannabis markets the number of cannabis products avail-able to consumers in commercial markets has prolifer-ated For example a new store in Oakland Californiareports selling over 500 products (40) and data fromsales in Colorado and Washington suggest that floweraccounts for a decreasing share of cannabis productspurchased (4142) While edibles and THC-infused bev-erages account for some of the non-flower market thefastest growing segment of the markets are the extracts forinhalation which include vaporizer pens oils and waxes

We know very little about the health consequences ndashboth the benefits and risks ndash of most of the productssold in retail stores in jurisdictions that have legalized(43) Indeed most of the health research cited in lega-lization debates is largely focused on studies conductedon those who were smoking lower potency flower inthe 1980s and 1990s (44) Jurisdictions making deci-sions about these products must also consider the con-sequences of keeping some prohibited will consumerssimply purchase banned in the unregulated illicit mar-ket or from a neighboring jurisdiction (allowing theother place to pocket the tax revenue)

So far none of the US states have banned certainproducts from being sold in licensed non-medicalstores Uruguay on the other hand only allows a fewstrains of flower to be sold in participating pharmaciesWhen the stores opened in Canada in October 2018only flower products and oils were allowed to be soldHealth Canada is taking more time to develop regula-tions for edibles and waxes

Potency

Closely related to the choice about product types is thedecision about whether to limit the potency of certainproducts There is not a large literature on this buta review by Englund et al (45) reported there werea few studies finding higher-potency cannabis to beassociated with negative mental health outcomesThey also cautioned

ldquo[o]nly since 2009 have studies differentiated betweentypes of cannabis based on their THC contentHowever most of these studies have not measuredTHC and cannabidiol content directly but have usedindirect measures of potency such as strengthsreported in studies of cannabis from police seizuresor coffee shops and have relied on self-reportmeasuresrdquo

With respect to the high-potency concentrates Kilmer(46) noted

Even less is known about the health consequences ofcannabis concentrates As late as 2015 there was noscientific evidence about dabbing which involves flashvaporization of concentrated cannabis which can exceed75-percent THC (47) A 2017 study of college studentsconcluded that butane-hash oil (BHO) use was associatedwith greater physiological dependence on cannabis butnoted that ldquolongitudinal research is needed to determineif cannabis users with higher levels of physiologicaldependence seek out BHO andor if BHO use increasesrisk for physiological dependence (48)rdquo

Of course when we talk about potency we must alsoconsider other cannabinoids (eg THCCBD ratios see45) and whether users are titrating their dosage (eg willsomeone who typically smokes a full joint at 5 THCconsume only one-third of a joint if its 15 THC) Thereare few studies of titration and they seem to be limited toEurope (see eg 49 50)

None of the legalization states in the US have imposedpotency limits on non-edible products There is somevariation with respect to edibles with some state limitingedible doses at 10 mg of THC per serving and othersimposing a lower limit of 5 mg Uruguay which onlyallows flower initially only allowed product that was

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 5

about 2 THC to be sold in the pharmacies but this waseventually increased to 9 THC

Canadarsquos legalization task force which produced thereport that served as the basis for the legislation thatwas eventually passed (51) put a lot of emphasis onpotency recommending that regulators ldquoDevelop stra-tegies to encourage consumption of less potent canna-bis including a price and tax scheme based on potencyto discourage purchase of high-potency productsrdquo

Purity

Just as jurisdictions will need to develop protocols fortesting and labeling for cannabinoids they will alsohave to make decisions about and develop protocolsfor the types of pesticides that can be used and otherlevels of impurities (eg mold bacteria metals) Thisnot only has health implications for consumers but itcan also create health risks for those working in thecannabis industry (5253)

Because of the federal prohibition in the US the agencygenerally tasked with developing regulations about pesti-cides and tolerances (Environmental Protection Agency)has not weighed in on cannabis This has left it up tovarious state agencies to make these decisions aboutimpurities creating a patchwork of regulations (see eg54) In contrast Canadarsquos federally regulated producersare all subject to the same regulations regardless of loca-tion In November 2018 the CanadianMinistry of Health(2018) published the list and limits of active ingredientswhich can differ depending on whether the product isfresh cannabis and plants dried cannabis or cannabis oil

Jurisdictions will also have to decide whether certainsubstances (eg alcohol and tobacco) can be mixed andsold with cannabis Since the overall health effects of can-nabis legalization will be shaped by what happens to theconsumption of alcohol opioids tobacco and other sub-stances (16) this decision could have important implica-tions for health So far no jurisdiction has allowed cannabisproducts to be infused with alcohol or tobacco In factmost places do not allow cannabis to be sold in stores thatsell alcohol or tobacco (Nova Scotia which sells both alco-hol and cannabis in the same state-run stores is a notableexception) But with some alcohol and some tobacco-related industries making significant investments in can-nabis producers in Canada it is reasonable to ask how longthis prohibition on mixing products will last

Price

Many of the outcomes that get discussed in legalizationdebates ndash the size of the illicit market consumption taxrevenues business profits ndash will be shaped by the post-

tax retail price of cannabis after legalization (3755) Asdiscussed earlier there are several reasons to expect theproduction costs to plummet after legalization how-ever jurisdictions have several tools they could use toincrease the retail price if they desire Minimize com-petition (eg limit wholesale andor retail market tothe government) set the price set a minimum pricelimit quantity discounts (eg by limiting the amountthat can be purchased) levy taxes and fees imposecostly regulations (eg thorough testing and labellingregimes)

Currently Uruguay is the only jurisdiction to date thatsets the price of the cannabis products sold and limits theamount individual can purchase at 10 g per week Canadaand all US jurisdictions limit the amount that can bepurchased in one transaction require some type of testing(some more rigorous than others) and impose taxes Inmany places these are ad valorem taxes which area function of price but there are several ways to taxcannabis (35556) Indeed one of the limits of price-based taxes is that revenue will decline as the price fallsunless there is a corresponding increase in consumption

An alternative approach is to tax cannabis asa function of its THC content (35557) This wouldbe similar to how the US federal government taxesliquor ndash as a function of its alcohol content The 2019Canadian Budget proposes to a tax of $001 per milli-gram of total THC for cannabis edibles extracts (whichwill include oils) and topicals (58) One advantage ofthis approach is that tax revenue would not fall asmarket prices decrease If the THC tax was progressive(ie the rate increases as the amount of THC in theproduct increases) it would make it easier for govern-ments to nudge consumers toward lower-potency pro-ducts One could also imagine taxes based on THCCBD ratios or other combinations of chemicals

If the testing and labeling regime is reliable ina jurisdiction ndash and this is a big if ndash then taxing asa function of THC (or some other combination of canna-binoids) should not be difficult But as Kilmer (46) notesldquoif the testing regimes yields inconsistent results or thesystem can be corrupted this creates challenges for label-ing and levying THC taxes In this situation jurisdictionscould consider using the company-stated THC level as thebase for an alternative minimum taxrdquo

Preferences for licenses

If jurisdictions decide to legalize and license commer-cial activity they will have to decide how to distributethose licenses Like those applying for alcohol licensesRegular business licenses To the highest bidders Orshould they give preferences to non-profits or for-

6 B KILMER

benefit corporations that are not driven solely byprofit To small businesses Something else As dis-cussed in the Profit Motive section this could haveimportant implications for the health and economicconsequences of legalization

With a goal of advancing social equity outcomesthere has been a movement in some jurisdictions togive preferences for business licenses to those who havebeen most harmed by cannabis prohibition (eg thosewho live in communities where a disproportionatenumber of arrests took place those from certainracialethnic groups andor those were previously con-victed of a cannabis offense) Oaklandrsquos first retail storeoperated by an equity applicant opened inNovember 2018 (40) San Franciscorsquos program is stillbeing implemented (59) and the licensed retail storesare just opening in Massachusetts thus it is too early toknow whether these programs have achieved their goalof building wealth and creating economic opportunitiesfor those preferred groups As part of its medical can-nabis program the state of Ohio sought to make sure atleast 15 of the licenses went to minority-owned firmshowever this provision was legally challenged anda judge recently ruled it unconstitutional (60)Whether this decision is upheld remains to be seenbut it highlights one challenge those developing socialequity programs may need to overcome

Another potential challenge is whether those groupsreceiving preferences for licenses have access to capitaland other forms of business assistance to be successfulin this industry In Californiarsquos new program up to$10 million will be dedicated to helping equity appli-cants including grants for startup and ongoing costsOf course when thinking about these programs aseconomic engines in certain communities one mustalso consider what the price drops will mean for theeconomic viability of those given preferred licensesA complementary or alternative approach would be toimpose a THC tax that would not be as sensitive toprice drops and dedicate some of that revenue to evi-dence-based programs that can improve economicopportunities for groups andor communities dispro-portionately affected by cannabis prohibition The pricedrop could also be mitigated by allowing the govern-ment to sell the product andor set the price (61)

Permanency

None of the changes made to cannabis policy need bepermanent whether it is through ballot initiatives orthe more traditional legislative process however open-ing the market to profit-maximizing firms makes itharder to make any changes that could significantly

affect their bottom line As noted above cautious jur-isdictions seeking alternatives to prohibiting cannabissupply may want to consider some of the middle-ground options presented in Figure 1

Issues of permanency also apply to regulations andproduct availability Jurisdictions do not have to allowall cannabis products to be made available for purchaseon Day 1 this is a choice For example those skepticalabout creating a market (and associated advertising) forhigh-potency waxes could continue prohibiting themwith a sunset clause that will end the ban after a fixedperiod of time unless it is extended by the legislatureSome jurisdictions may also want to impose a similarsunset clause with respect to on-premises consumptionsince it is unclear what this means for overall impaireddriving (62) however they will need to weigh thisagainst the problems associated with legalizing canna-bis but banning public consumption

Concluding thoughts

Creating a new legal regime for cannabis supply iscomplex This article highlights 14 of the main choicesthere are obviously others The bottom line is thatjurisdictions have many options and they should notfeel as if the Colorado and Washington models thathave been replicated in some US states are the onlyapproaches for implementing an alternative to cannabissupply prohibition

These 14 Ps should also serve as a warning for analystsconducting research on legalization Using a simple bin-ary variable indicating whether a jurisdiction has lega-lized or not in a standard differences-in-differencesframework is not only crude but it could lead to incor-rect inferences if the jurisdictions have made differentchoices about these factors (63) Researchers must alsoconsider that states will likely adjust regulations overtime which could have important implications forhealth safety andor social equity

Financial disclosures

The author reports no relevant financial conflicts

Funding

National Institute on Drug Abuse (R01DA040924)

References

1 Caulkins JP Hawken A Kilmer B Kleiman MAMarijuana legalization what everyone needs to knowNew York (NY) Oxford University Press 2012

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 7

2 Rolles S Murkin G How to regulate cannabis a prac-tical guide Transform Drug Policy Foundation 2013

3 Caulkins JP Kilmer B Kleiman MA MacCoun RJMidgette G Oglesby P Pacula RL Reuter PHConsidering marijuana legalization insights forVermont and other jurisdictions Santa Monica (CA)Rand Corporation 2015 Report No RR-864

4 Pacula RL Kilmer B Wagenaar AC Chaloupka FJCaulkins JP Developing public health regulations formarijuana lessons from alcohol and tobacco AmJ Public Health 20141041021ndash28 doi102105AJPH2013301766

5 Kilmer B Policy designs for cannabis legalizationstarting with the eight Ps Am J Drug Alcohol Abuse201440259ndash61 doi103109009529902014894047

6 Kilmer B The ldquo10 Psrdquo of Marijuana LegalizationBerkeley Rev Latin Am Stud 20155455

7 Kilmer B Caulkins JP Pacula RL MacCoun RJReuter P Altered state assessing how marijuana lega-lization in California could influence marijuana con-sumption and public budgets Santa Monica (CA)RAND Corporation 2010

8 Reuter P Kleiman MA Risks and prices an economicanalysis of drug enforcement Crime Justice19867289ndash340 doi101086449116

9 Caulkins J Effects of prohibition enforcement and inter-diction on drug use In Quah Collins Atuesta BecerraCaulkins J Csete J Drucker E Felbab-Brown V et aleds Ending the drug wars report of the LSE ExpertGroup on the economics of drug policy 201416ndash24httpwwwlseacukideasAssetsDocumentsreportsLSE-IDEAS-Ending-the-Drug-Warspdf

10 Colorado Department of Revenue Current amp priorretail marijuana average market rates (Median marketprices) 2019 httpswwwcoloradogovpacificsitesdefaultfilesAMR_CurrentAndPriorRates_Jul2019pdf

11 Cannabis Benchmarks 2018 ldquoCannabis BenchmarksSpot Price Indicies The Big Four vs The USrdquoSeptember httpswwwcannabisbenchmarkscom

12 Kleiman M Hampsher S Davenport S Manning CHeussler L Interviews with cannabis licensees inWashington State New York BOTEC AnalysisForthcoming

13 Cherney MA Cannabis is now legal in Canada but potcompanies expect a rocky start MarketWatch 2018httpswwwmarketwatchcomstorycannabis-is-now-legal-in-canada-but-pot-companies-expect-a-rocky-start-2018-10-17

14 Government of Canada Canada Go Cannabis in theprovinces and territories Canada government ofCanada 2018a [accessed 2018 Oct 22 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsprovinces-territorieshtml

15 Kilmer B Everingham S Caulkins J Midgette GPacula R Reuter P Burns R et al What Americarsquosusers spend on illegal drugs 2000ndash2010 Prepared forthe Office of National Drug Control PolicyWashington (DC) RAND Corporation 2014

16 Caulkins JP Kilmer B Kleiman MA Marijuana legali-zation what everyone needs to know 2nd edNew York Oxford University Press 2016

17 Caulkins JP Kilmer B Considering marijuana legaliza-tion carefully insights for other jurisdictions fromanalysis for Vermont Addiction 2016Dec1112082ndash89 doi101111add13289

18 Wilkins C After the legalisation of cannabis the CannabisIncorporated Society (CIS) regulatory model for recrea-tional cannabis in New Zealand NZ Med J201612917ndash20

19 Cerdaacute M Kilmer B Uruguayrsquos middle-groundapproach to cannabis legalization Int J Drug Policy201742118ndash20 doi101016jdrugpo201702007

20 Pardo B Cannabis policy reforms in the Americasa comparative analysis of Colorado Washington andUruguay Int J Drug Policy 201425727ndash35doi101016jdrugpo201405010

21 Walsh J Ramsey G Uruguayrsquos drug policy majorinnovations major challenges WashingtonBrookings 2015 httpwww brookingsedu~mediaResearchFilesPapers201504global-drug-policyWalshndashUruguay-finalpdf

22 Wilson JQ Bureaucracy what government agencies doand why they do it New York (NY) Basic Books 1989

23 Alaska Department of Commerce Community andEconomic Development Marijuana control boardmembers 2019 httpswwwcommercealaskagovwebamcoMCBMembersaspx

24 Warner K Selling smoke cigarette advertising andpublic health Amer Public Health Association 1986

25 Saffer H Studying the effects of alcohol advertising onconsumption AlcoholHealth ResWorld 199620266ndash272

26 MacCoun RJ Reuter P Drug war heresies learningfrom other vices times and places CambridgeUniversity Press 2001

27 Bird MG The Rise of the Liquor Control Board ofOntario 1985-2009 Can Political Sci Rev 201041ndash17

28 Government of Canada Canada Go Regulations tosupport coming into force of the Cannabis ActCanada government of Canada 2018b [accessed 2018July 11 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsregulations-support-cannabis-acthtml

29 Ingold J To educate people about marijuana Coloradohealth officals tried ads with a radically friendly toneDid it work The denver post [Internet] 2018 httpswwwdenverpostcom20180122colorado-marijuana-education-advertising

30 Crawford K Colorado Department of Public Health ampEnvironment (CDPHE) Retail Marijuana EducationProgram 2017 annual reportDenver (CO)CDPHE 2018

31 Branan B Public safety agencies launch drugged drivingcampaign in advance of legalized marijuanaSacramento Bee 2017 httpswwwsacbeecomnewslocalarticle191881659html

32 National Inventory of Collateral Consequences ofConviction 2018 httpsniccccsgjusticecenterorg

33 Southern Poverty Law Center Alabamalsquos war on mar-ijuana assessing the fiscal and human toll on crimina-lization Montgomery (AL) Southern Poverty LawCenter 2018

34 Subbaraman M Substitution and complementarity ofalcohol and cannabis a review of the literature Subst

8 B KILMER

Policing and enforcement

One argument made for legalizing cannabis is that itwill reduce the time and effort law enforcement officialsspend on cannabis offenses This would also decreasethe number of people arrested for cannabis offensesmany of whom then must confront the collateral con-sequences of being arrested or convicted a drug offense(32) Given the well documented racial and ethnic dis-parities in cannabis-related offenses (eg 33)a reduction in arrests could have important implica-tions for social equity outcomes

Legalization will not eliminate police-related canna-bis contacts (eg there will still be arrests for drivingunder the influence of cannabis underage possessionpublic consumption illicit growing) In fact ifa jurisdiction is committed to reducing the size of theillicit market as quickly as possible it may seek tosignificantly ramp up enforcement against unlicensedproducers and sellers Thus an important choice con-fronting jurisdictions is how much time and effort theywant to devote to enforcing cannabis laws (includingDUI) after a decision is made to legalize

There is also a possibility that legalization couldinfluence non-cannabis specific offenses especially ifit affects the use of substances like alcohol which havestronger connections to criminal activity That said it ishard to predict the effect on crime as the evidenceabout whether alcohol and cannabis are substitutes orcomplements is mixed and it is unclear how applicableit will be in the post-legalization world (33435)

Penalties

A related choice confronting legalizing jurisdictions iswhether they will change the penalties for those con-victed of a cannabis offense post-legalization This willhave implications for social equity health and safetyFor example should possession of cannabis by thoseunder age remain a criminal offense or should it beakin to a traffic citation Another important choice willbe the penalties for those producing or selling outsideof the licensed system Will it just be a fine or woulda conviction lead to a criminal offense Similar ques-tions can be asked for those in the licensed system whoillegally divert product but in that situation there areadditional options revoking or suspending the license

Another decision confronting legalizing jurisdictions iswhether there will still be penalties for probationers andparolees who are ordered to urinalyses and test positivefor cannabis In some jurisdictions those subject to

community corrections are ordered to abstain from alco-hol (which is legal for the rest of the population 21 yearsand older) but this is often because alcohol consumptionwas believed to be related to the offense

Penalties for driving under the influence of cannabisare a contentious issue especially since it is difficult todetermine if a driver is under the influence of cannabisWhile the bulk of the research suggests that driving underthe influence of alcohol is more dangerous than drivingunder the influence of cannabis driving under the influ-ence of cannabis is still more dangerous than drivingsober further the bulk of the research suggests thatdrivers under the influence of both alcohol and cannabisare reported to be much more likely to get in an accident(16) Some researchers argue that because the risks ofdriving under the influence of cannabis alone are somuch lower than they are for alcohol the penalty for theformer should not be a criminal offense (36)

To date every jurisdiction that has legalized stillprohibits driving under the influence of cannabis asa criminal offense however the thresholds used todetermine if someone is under the influence is differ-ent For example Colorado and Washington havea 5-nanogram of THC per milliliter of blood (ngml)limit for drivers but similar thresholds were not imple-mented in Oregon or California In Canada they alsohave instituted a 5 ngml THC threshold for a criminaloffense but there are also consequences for those withlower amounts of THC in the blood Those with two ormore ngml but less than five could still be subject toa noncriminal offense that could lead to a fine of up to$1000 Because of the risks associated with drivingunder the influence of both alcohol and cannabis it isalso a criminal offense to have a blood alcohol concen-tration of 005 and more than 25 ngml of THC inthe blood (37)

Prior criminal records

Given the aforementioned racial and ethnic disparitiesassociated with cannabis prohibition there is a growingdiscussion about what jurisdictions should do aboutthose who were convicted of cannabis-related offensesthat are now legal This not only has wide-rangingimplications because of the various collateral conse-quences associated with having a drug arrest or convic-tion on your record but it can also influence who getsto participate in the newly legal market

Jurisdictions not only have to decide whether toremove or expunge these from individualrsquos criminalrecords but they also have to make decisions about

4 B KILMER

which offenses All cannabis offenses Just possessionIf jurisdictions do create a pathway to expungementthey must also decide how easy it will be to expungethese offenses Will the onus be on the individuals to gothrough the process or will the new legislation requirestate officials to automatically delete these offensesfrom their records

The early legalization initiatives passed in the UnitedStates were largely silent when it came to addressingthose with criminal records for cannabis offenses Thisstarted to change when Oregon voters passed legaliza-tion in 2014 and made it easier to seal previous con-victions for cannabis offenses Then in 2016Californiarsquos initiative authorized ldquoresentencing or dis-missal and sealing of prior eligible marijuana-relatedconvictionsrdquo (38) however the responsibility to peti-tion the courts was still with the individuals who hadbeen convicted In September 2018 CaliforniarsquosGovernor Brown signed a bill which changes this bystreamlining and automating the process for whatcould be more than 200000 individuals (39) Otherjurisdictions have implemented or are consideringsimilar approaches (eg Denver the entire state ofMassachusetts)

Product types

Jurisdictions considering legalization also have decisionsto make about the types of cannabis products allowed inthe market Beginning with loosely regulated medicalcannabis markets the number of cannabis products avail-able to consumers in commercial markets has prolifer-ated For example a new store in Oakland Californiareports selling over 500 products (40) and data fromsales in Colorado and Washington suggest that floweraccounts for a decreasing share of cannabis productspurchased (4142) While edibles and THC-infused bev-erages account for some of the non-flower market thefastest growing segment of the markets are the extracts forinhalation which include vaporizer pens oils and waxes

We know very little about the health consequences ndashboth the benefits and risks ndash of most of the productssold in retail stores in jurisdictions that have legalized(43) Indeed most of the health research cited in lega-lization debates is largely focused on studies conductedon those who were smoking lower potency flower inthe 1980s and 1990s (44) Jurisdictions making deci-sions about these products must also consider the con-sequences of keeping some prohibited will consumerssimply purchase banned in the unregulated illicit mar-ket or from a neighboring jurisdiction (allowing theother place to pocket the tax revenue)

So far none of the US states have banned certainproducts from being sold in licensed non-medicalstores Uruguay on the other hand only allows a fewstrains of flower to be sold in participating pharmaciesWhen the stores opened in Canada in October 2018only flower products and oils were allowed to be soldHealth Canada is taking more time to develop regula-tions for edibles and waxes

Potency

Closely related to the choice about product types is thedecision about whether to limit the potency of certainproducts There is not a large literature on this buta review by Englund et al (45) reported there werea few studies finding higher-potency cannabis to beassociated with negative mental health outcomesThey also cautioned

ldquo[o]nly since 2009 have studies differentiated betweentypes of cannabis based on their THC contentHowever most of these studies have not measuredTHC and cannabidiol content directly but have usedindirect measures of potency such as strengthsreported in studies of cannabis from police seizuresor coffee shops and have relied on self-reportmeasuresrdquo

With respect to the high-potency concentrates Kilmer(46) noted

Even less is known about the health consequences ofcannabis concentrates As late as 2015 there was noscientific evidence about dabbing which involves flashvaporization of concentrated cannabis which can exceed75-percent THC (47) A 2017 study of college studentsconcluded that butane-hash oil (BHO) use was associatedwith greater physiological dependence on cannabis butnoted that ldquolongitudinal research is needed to determineif cannabis users with higher levels of physiologicaldependence seek out BHO andor if BHO use increasesrisk for physiological dependence (48)rdquo

Of course when we talk about potency we must alsoconsider other cannabinoids (eg THCCBD ratios see45) and whether users are titrating their dosage (eg willsomeone who typically smokes a full joint at 5 THCconsume only one-third of a joint if its 15 THC) Thereare few studies of titration and they seem to be limited toEurope (see eg 49 50)

None of the legalization states in the US have imposedpotency limits on non-edible products There is somevariation with respect to edibles with some state limitingedible doses at 10 mg of THC per serving and othersimposing a lower limit of 5 mg Uruguay which onlyallows flower initially only allowed product that was

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 5

about 2 THC to be sold in the pharmacies but this waseventually increased to 9 THC

Canadarsquos legalization task force which produced thereport that served as the basis for the legislation thatwas eventually passed (51) put a lot of emphasis onpotency recommending that regulators ldquoDevelop stra-tegies to encourage consumption of less potent canna-bis including a price and tax scheme based on potencyto discourage purchase of high-potency productsrdquo

Purity

Just as jurisdictions will need to develop protocols fortesting and labeling for cannabinoids they will alsohave to make decisions about and develop protocolsfor the types of pesticides that can be used and otherlevels of impurities (eg mold bacteria metals) Thisnot only has health implications for consumers but itcan also create health risks for those working in thecannabis industry (5253)

Because of the federal prohibition in the US the agencygenerally tasked with developing regulations about pesti-cides and tolerances (Environmental Protection Agency)has not weighed in on cannabis This has left it up tovarious state agencies to make these decisions aboutimpurities creating a patchwork of regulations (see eg54) In contrast Canadarsquos federally regulated producersare all subject to the same regulations regardless of loca-tion In November 2018 the CanadianMinistry of Health(2018) published the list and limits of active ingredientswhich can differ depending on whether the product isfresh cannabis and plants dried cannabis or cannabis oil

Jurisdictions will also have to decide whether certainsubstances (eg alcohol and tobacco) can be mixed andsold with cannabis Since the overall health effects of can-nabis legalization will be shaped by what happens to theconsumption of alcohol opioids tobacco and other sub-stances (16) this decision could have important implica-tions for health So far no jurisdiction has allowed cannabisproducts to be infused with alcohol or tobacco In factmost places do not allow cannabis to be sold in stores thatsell alcohol or tobacco (Nova Scotia which sells both alco-hol and cannabis in the same state-run stores is a notableexception) But with some alcohol and some tobacco-related industries making significant investments in can-nabis producers in Canada it is reasonable to ask how longthis prohibition on mixing products will last

Price

Many of the outcomes that get discussed in legalizationdebates ndash the size of the illicit market consumption taxrevenues business profits ndash will be shaped by the post-

tax retail price of cannabis after legalization (3755) Asdiscussed earlier there are several reasons to expect theproduction costs to plummet after legalization how-ever jurisdictions have several tools they could use toincrease the retail price if they desire Minimize com-petition (eg limit wholesale andor retail market tothe government) set the price set a minimum pricelimit quantity discounts (eg by limiting the amountthat can be purchased) levy taxes and fees imposecostly regulations (eg thorough testing and labellingregimes)

Currently Uruguay is the only jurisdiction to date thatsets the price of the cannabis products sold and limits theamount individual can purchase at 10 g per week Canadaand all US jurisdictions limit the amount that can bepurchased in one transaction require some type of testing(some more rigorous than others) and impose taxes Inmany places these are ad valorem taxes which area function of price but there are several ways to taxcannabis (35556) Indeed one of the limits of price-based taxes is that revenue will decline as the price fallsunless there is a corresponding increase in consumption

An alternative approach is to tax cannabis asa function of its THC content (35557) This wouldbe similar to how the US federal government taxesliquor ndash as a function of its alcohol content The 2019Canadian Budget proposes to a tax of $001 per milli-gram of total THC for cannabis edibles extracts (whichwill include oils) and topicals (58) One advantage ofthis approach is that tax revenue would not fall asmarket prices decrease If the THC tax was progressive(ie the rate increases as the amount of THC in theproduct increases) it would make it easier for govern-ments to nudge consumers toward lower-potency pro-ducts One could also imagine taxes based on THCCBD ratios or other combinations of chemicals

If the testing and labeling regime is reliable ina jurisdiction ndash and this is a big if ndash then taxing asa function of THC (or some other combination of canna-binoids) should not be difficult But as Kilmer (46) notesldquoif the testing regimes yields inconsistent results or thesystem can be corrupted this creates challenges for label-ing and levying THC taxes In this situation jurisdictionscould consider using the company-stated THC level as thebase for an alternative minimum taxrdquo

Preferences for licenses

If jurisdictions decide to legalize and license commer-cial activity they will have to decide how to distributethose licenses Like those applying for alcohol licensesRegular business licenses To the highest bidders Orshould they give preferences to non-profits or for-

6 B KILMER

benefit corporations that are not driven solely byprofit To small businesses Something else As dis-cussed in the Profit Motive section this could haveimportant implications for the health and economicconsequences of legalization

With a goal of advancing social equity outcomesthere has been a movement in some jurisdictions togive preferences for business licenses to those who havebeen most harmed by cannabis prohibition (eg thosewho live in communities where a disproportionatenumber of arrests took place those from certainracialethnic groups andor those were previously con-victed of a cannabis offense) Oaklandrsquos first retail storeoperated by an equity applicant opened inNovember 2018 (40) San Franciscorsquos program is stillbeing implemented (59) and the licensed retail storesare just opening in Massachusetts thus it is too early toknow whether these programs have achieved their goalof building wealth and creating economic opportunitiesfor those preferred groups As part of its medical can-nabis program the state of Ohio sought to make sure atleast 15 of the licenses went to minority-owned firmshowever this provision was legally challenged anda judge recently ruled it unconstitutional (60)Whether this decision is upheld remains to be seenbut it highlights one challenge those developing socialequity programs may need to overcome

Another potential challenge is whether those groupsreceiving preferences for licenses have access to capitaland other forms of business assistance to be successfulin this industry In Californiarsquos new program up to$10 million will be dedicated to helping equity appli-cants including grants for startup and ongoing costsOf course when thinking about these programs aseconomic engines in certain communities one mustalso consider what the price drops will mean for theeconomic viability of those given preferred licensesA complementary or alternative approach would be toimpose a THC tax that would not be as sensitive toprice drops and dedicate some of that revenue to evi-dence-based programs that can improve economicopportunities for groups andor communities dispro-portionately affected by cannabis prohibition The pricedrop could also be mitigated by allowing the govern-ment to sell the product andor set the price (61)

Permanency

None of the changes made to cannabis policy need bepermanent whether it is through ballot initiatives orthe more traditional legislative process however open-ing the market to profit-maximizing firms makes itharder to make any changes that could significantly

affect their bottom line As noted above cautious jur-isdictions seeking alternatives to prohibiting cannabissupply may want to consider some of the middle-ground options presented in Figure 1

Issues of permanency also apply to regulations andproduct availability Jurisdictions do not have to allowall cannabis products to be made available for purchaseon Day 1 this is a choice For example those skepticalabout creating a market (and associated advertising) forhigh-potency waxes could continue prohibiting themwith a sunset clause that will end the ban after a fixedperiod of time unless it is extended by the legislatureSome jurisdictions may also want to impose a similarsunset clause with respect to on-premises consumptionsince it is unclear what this means for overall impaireddriving (62) however they will need to weigh thisagainst the problems associated with legalizing canna-bis but banning public consumption

Concluding thoughts

Creating a new legal regime for cannabis supply iscomplex This article highlights 14 of the main choicesthere are obviously others The bottom line is thatjurisdictions have many options and they should notfeel as if the Colorado and Washington models thathave been replicated in some US states are the onlyapproaches for implementing an alternative to cannabissupply prohibition

These 14 Ps should also serve as a warning for analystsconducting research on legalization Using a simple bin-ary variable indicating whether a jurisdiction has lega-lized or not in a standard differences-in-differencesframework is not only crude but it could lead to incor-rect inferences if the jurisdictions have made differentchoices about these factors (63) Researchers must alsoconsider that states will likely adjust regulations overtime which could have important implications forhealth safety andor social equity

Financial disclosures

The author reports no relevant financial conflicts

Funding

National Institute on Drug Abuse (R01DA040924)

References

1 Caulkins JP Hawken A Kilmer B Kleiman MAMarijuana legalization what everyone needs to knowNew York (NY) Oxford University Press 2012

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 7

2 Rolles S Murkin G How to regulate cannabis a prac-tical guide Transform Drug Policy Foundation 2013

3 Caulkins JP Kilmer B Kleiman MA MacCoun RJMidgette G Oglesby P Pacula RL Reuter PHConsidering marijuana legalization insights forVermont and other jurisdictions Santa Monica (CA)Rand Corporation 2015 Report No RR-864

4 Pacula RL Kilmer B Wagenaar AC Chaloupka FJCaulkins JP Developing public health regulations formarijuana lessons from alcohol and tobacco AmJ Public Health 20141041021ndash28 doi102105AJPH2013301766

5 Kilmer B Policy designs for cannabis legalizationstarting with the eight Ps Am J Drug Alcohol Abuse201440259ndash61 doi103109009529902014894047

6 Kilmer B The ldquo10 Psrdquo of Marijuana LegalizationBerkeley Rev Latin Am Stud 20155455

7 Kilmer B Caulkins JP Pacula RL MacCoun RJReuter P Altered state assessing how marijuana lega-lization in California could influence marijuana con-sumption and public budgets Santa Monica (CA)RAND Corporation 2010

8 Reuter P Kleiman MA Risks and prices an economicanalysis of drug enforcement Crime Justice19867289ndash340 doi101086449116

9 Caulkins J Effects of prohibition enforcement and inter-diction on drug use In Quah Collins Atuesta BecerraCaulkins J Csete J Drucker E Felbab-Brown V et aleds Ending the drug wars report of the LSE ExpertGroup on the economics of drug policy 201416ndash24httpwwwlseacukideasAssetsDocumentsreportsLSE-IDEAS-Ending-the-Drug-Warspdf

10 Colorado Department of Revenue Current amp priorretail marijuana average market rates (Median marketprices) 2019 httpswwwcoloradogovpacificsitesdefaultfilesAMR_CurrentAndPriorRates_Jul2019pdf

11 Cannabis Benchmarks 2018 ldquoCannabis BenchmarksSpot Price Indicies The Big Four vs The USrdquoSeptember httpswwwcannabisbenchmarkscom

12 Kleiman M Hampsher S Davenport S Manning CHeussler L Interviews with cannabis licensees inWashington State New York BOTEC AnalysisForthcoming

13 Cherney MA Cannabis is now legal in Canada but potcompanies expect a rocky start MarketWatch 2018httpswwwmarketwatchcomstorycannabis-is-now-legal-in-canada-but-pot-companies-expect-a-rocky-start-2018-10-17

14 Government of Canada Canada Go Cannabis in theprovinces and territories Canada government ofCanada 2018a [accessed 2018 Oct 22 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsprovinces-territorieshtml

15 Kilmer B Everingham S Caulkins J Midgette GPacula R Reuter P Burns R et al What Americarsquosusers spend on illegal drugs 2000ndash2010 Prepared forthe Office of National Drug Control PolicyWashington (DC) RAND Corporation 2014

16 Caulkins JP Kilmer B Kleiman MA Marijuana legali-zation what everyone needs to know 2nd edNew York Oxford University Press 2016

17 Caulkins JP Kilmer B Considering marijuana legaliza-tion carefully insights for other jurisdictions fromanalysis for Vermont Addiction 2016Dec1112082ndash89 doi101111add13289

18 Wilkins C After the legalisation of cannabis the CannabisIncorporated Society (CIS) regulatory model for recrea-tional cannabis in New Zealand NZ Med J201612917ndash20

19 Cerdaacute M Kilmer B Uruguayrsquos middle-groundapproach to cannabis legalization Int J Drug Policy201742118ndash20 doi101016jdrugpo201702007

20 Pardo B Cannabis policy reforms in the Americasa comparative analysis of Colorado Washington andUruguay Int J Drug Policy 201425727ndash35doi101016jdrugpo201405010

21 Walsh J Ramsey G Uruguayrsquos drug policy majorinnovations major challenges WashingtonBrookings 2015 httpwww brookingsedu~mediaResearchFilesPapers201504global-drug-policyWalshndashUruguay-finalpdf

22 Wilson JQ Bureaucracy what government agencies doand why they do it New York (NY) Basic Books 1989

23 Alaska Department of Commerce Community andEconomic Development Marijuana control boardmembers 2019 httpswwwcommercealaskagovwebamcoMCBMembersaspx

24 Warner K Selling smoke cigarette advertising andpublic health Amer Public Health Association 1986

25 Saffer H Studying the effects of alcohol advertising onconsumption AlcoholHealth ResWorld 199620266ndash272

26 MacCoun RJ Reuter P Drug war heresies learningfrom other vices times and places CambridgeUniversity Press 2001

27 Bird MG The Rise of the Liquor Control Board ofOntario 1985-2009 Can Political Sci Rev 201041ndash17

28 Government of Canada Canada Go Regulations tosupport coming into force of the Cannabis ActCanada government of Canada 2018b [accessed 2018July 11 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsregulations-support-cannabis-acthtml

29 Ingold J To educate people about marijuana Coloradohealth officals tried ads with a radically friendly toneDid it work The denver post [Internet] 2018 httpswwwdenverpostcom20180122colorado-marijuana-education-advertising

30 Crawford K Colorado Department of Public Health ampEnvironment (CDPHE) Retail Marijuana EducationProgram 2017 annual reportDenver (CO)CDPHE 2018

31 Branan B Public safety agencies launch drugged drivingcampaign in advance of legalized marijuanaSacramento Bee 2017 httpswwwsacbeecomnewslocalarticle191881659html

32 National Inventory of Collateral Consequences ofConviction 2018 httpsniccccsgjusticecenterorg

33 Southern Poverty Law Center Alabamalsquos war on mar-ijuana assessing the fiscal and human toll on crimina-lization Montgomery (AL) Southern Poverty LawCenter 2018

34 Subbaraman M Substitution and complementarity ofalcohol and cannabis a review of the literature Subst

8 B KILMER

which offenses All cannabis offenses Just possessionIf jurisdictions do create a pathway to expungementthey must also decide how easy it will be to expungethese offenses Will the onus be on the individuals to gothrough the process or will the new legislation requirestate officials to automatically delete these offensesfrom their records

The early legalization initiatives passed in the UnitedStates were largely silent when it came to addressingthose with criminal records for cannabis offenses Thisstarted to change when Oregon voters passed legaliza-tion in 2014 and made it easier to seal previous con-victions for cannabis offenses Then in 2016Californiarsquos initiative authorized ldquoresentencing or dis-missal and sealing of prior eligible marijuana-relatedconvictionsrdquo (38) however the responsibility to peti-tion the courts was still with the individuals who hadbeen convicted In September 2018 CaliforniarsquosGovernor Brown signed a bill which changes this bystreamlining and automating the process for whatcould be more than 200000 individuals (39) Otherjurisdictions have implemented or are consideringsimilar approaches (eg Denver the entire state ofMassachusetts)

Product types

Jurisdictions considering legalization also have decisionsto make about the types of cannabis products allowed inthe market Beginning with loosely regulated medicalcannabis markets the number of cannabis products avail-able to consumers in commercial markets has prolifer-ated For example a new store in Oakland Californiareports selling over 500 products (40) and data fromsales in Colorado and Washington suggest that floweraccounts for a decreasing share of cannabis productspurchased (4142) While edibles and THC-infused bev-erages account for some of the non-flower market thefastest growing segment of the markets are the extracts forinhalation which include vaporizer pens oils and waxes

We know very little about the health consequences ndashboth the benefits and risks ndash of most of the productssold in retail stores in jurisdictions that have legalized(43) Indeed most of the health research cited in lega-lization debates is largely focused on studies conductedon those who were smoking lower potency flower inthe 1980s and 1990s (44) Jurisdictions making deci-sions about these products must also consider the con-sequences of keeping some prohibited will consumerssimply purchase banned in the unregulated illicit mar-ket or from a neighboring jurisdiction (allowing theother place to pocket the tax revenue)

So far none of the US states have banned certainproducts from being sold in licensed non-medicalstores Uruguay on the other hand only allows a fewstrains of flower to be sold in participating pharmaciesWhen the stores opened in Canada in October 2018only flower products and oils were allowed to be soldHealth Canada is taking more time to develop regula-tions for edibles and waxes

Potency

Closely related to the choice about product types is thedecision about whether to limit the potency of certainproducts There is not a large literature on this buta review by Englund et al (45) reported there werea few studies finding higher-potency cannabis to beassociated with negative mental health outcomesThey also cautioned

ldquo[o]nly since 2009 have studies differentiated betweentypes of cannabis based on their THC contentHowever most of these studies have not measuredTHC and cannabidiol content directly but have usedindirect measures of potency such as strengthsreported in studies of cannabis from police seizuresor coffee shops and have relied on self-reportmeasuresrdquo

With respect to the high-potency concentrates Kilmer(46) noted

Even less is known about the health consequences ofcannabis concentrates As late as 2015 there was noscientific evidence about dabbing which involves flashvaporization of concentrated cannabis which can exceed75-percent THC (47) A 2017 study of college studentsconcluded that butane-hash oil (BHO) use was associatedwith greater physiological dependence on cannabis butnoted that ldquolongitudinal research is needed to determineif cannabis users with higher levels of physiologicaldependence seek out BHO andor if BHO use increasesrisk for physiological dependence (48)rdquo

Of course when we talk about potency we must alsoconsider other cannabinoids (eg THCCBD ratios see45) and whether users are titrating their dosage (eg willsomeone who typically smokes a full joint at 5 THCconsume only one-third of a joint if its 15 THC) Thereare few studies of titration and they seem to be limited toEurope (see eg 49 50)

None of the legalization states in the US have imposedpotency limits on non-edible products There is somevariation with respect to edibles with some state limitingedible doses at 10 mg of THC per serving and othersimposing a lower limit of 5 mg Uruguay which onlyallows flower initially only allowed product that was

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 5

about 2 THC to be sold in the pharmacies but this waseventually increased to 9 THC

Canadarsquos legalization task force which produced thereport that served as the basis for the legislation thatwas eventually passed (51) put a lot of emphasis onpotency recommending that regulators ldquoDevelop stra-tegies to encourage consumption of less potent canna-bis including a price and tax scheme based on potencyto discourage purchase of high-potency productsrdquo

Purity

Just as jurisdictions will need to develop protocols fortesting and labeling for cannabinoids they will alsohave to make decisions about and develop protocolsfor the types of pesticides that can be used and otherlevels of impurities (eg mold bacteria metals) Thisnot only has health implications for consumers but itcan also create health risks for those working in thecannabis industry (5253)

Because of the federal prohibition in the US the agencygenerally tasked with developing regulations about pesti-cides and tolerances (Environmental Protection Agency)has not weighed in on cannabis This has left it up tovarious state agencies to make these decisions aboutimpurities creating a patchwork of regulations (see eg54) In contrast Canadarsquos federally regulated producersare all subject to the same regulations regardless of loca-tion In November 2018 the CanadianMinistry of Health(2018) published the list and limits of active ingredientswhich can differ depending on whether the product isfresh cannabis and plants dried cannabis or cannabis oil

Jurisdictions will also have to decide whether certainsubstances (eg alcohol and tobacco) can be mixed andsold with cannabis Since the overall health effects of can-nabis legalization will be shaped by what happens to theconsumption of alcohol opioids tobacco and other sub-stances (16) this decision could have important implica-tions for health So far no jurisdiction has allowed cannabisproducts to be infused with alcohol or tobacco In factmost places do not allow cannabis to be sold in stores thatsell alcohol or tobacco (Nova Scotia which sells both alco-hol and cannabis in the same state-run stores is a notableexception) But with some alcohol and some tobacco-related industries making significant investments in can-nabis producers in Canada it is reasonable to ask how longthis prohibition on mixing products will last

Price

Many of the outcomes that get discussed in legalizationdebates ndash the size of the illicit market consumption taxrevenues business profits ndash will be shaped by the post-

tax retail price of cannabis after legalization (3755) Asdiscussed earlier there are several reasons to expect theproduction costs to plummet after legalization how-ever jurisdictions have several tools they could use toincrease the retail price if they desire Minimize com-petition (eg limit wholesale andor retail market tothe government) set the price set a minimum pricelimit quantity discounts (eg by limiting the amountthat can be purchased) levy taxes and fees imposecostly regulations (eg thorough testing and labellingregimes)

Currently Uruguay is the only jurisdiction to date thatsets the price of the cannabis products sold and limits theamount individual can purchase at 10 g per week Canadaand all US jurisdictions limit the amount that can bepurchased in one transaction require some type of testing(some more rigorous than others) and impose taxes Inmany places these are ad valorem taxes which area function of price but there are several ways to taxcannabis (35556) Indeed one of the limits of price-based taxes is that revenue will decline as the price fallsunless there is a corresponding increase in consumption

An alternative approach is to tax cannabis asa function of its THC content (35557) This wouldbe similar to how the US federal government taxesliquor ndash as a function of its alcohol content The 2019Canadian Budget proposes to a tax of $001 per milli-gram of total THC for cannabis edibles extracts (whichwill include oils) and topicals (58) One advantage ofthis approach is that tax revenue would not fall asmarket prices decrease If the THC tax was progressive(ie the rate increases as the amount of THC in theproduct increases) it would make it easier for govern-ments to nudge consumers toward lower-potency pro-ducts One could also imagine taxes based on THCCBD ratios or other combinations of chemicals

If the testing and labeling regime is reliable ina jurisdiction ndash and this is a big if ndash then taxing asa function of THC (or some other combination of canna-binoids) should not be difficult But as Kilmer (46) notesldquoif the testing regimes yields inconsistent results or thesystem can be corrupted this creates challenges for label-ing and levying THC taxes In this situation jurisdictionscould consider using the company-stated THC level as thebase for an alternative minimum taxrdquo

Preferences for licenses

If jurisdictions decide to legalize and license commer-cial activity they will have to decide how to distributethose licenses Like those applying for alcohol licensesRegular business licenses To the highest bidders Orshould they give preferences to non-profits or for-

6 B KILMER

benefit corporations that are not driven solely byprofit To small businesses Something else As dis-cussed in the Profit Motive section this could haveimportant implications for the health and economicconsequences of legalization

With a goal of advancing social equity outcomesthere has been a movement in some jurisdictions togive preferences for business licenses to those who havebeen most harmed by cannabis prohibition (eg thosewho live in communities where a disproportionatenumber of arrests took place those from certainracialethnic groups andor those were previously con-victed of a cannabis offense) Oaklandrsquos first retail storeoperated by an equity applicant opened inNovember 2018 (40) San Franciscorsquos program is stillbeing implemented (59) and the licensed retail storesare just opening in Massachusetts thus it is too early toknow whether these programs have achieved their goalof building wealth and creating economic opportunitiesfor those preferred groups As part of its medical can-nabis program the state of Ohio sought to make sure atleast 15 of the licenses went to minority-owned firmshowever this provision was legally challenged anda judge recently ruled it unconstitutional (60)Whether this decision is upheld remains to be seenbut it highlights one challenge those developing socialequity programs may need to overcome

Another potential challenge is whether those groupsreceiving preferences for licenses have access to capitaland other forms of business assistance to be successfulin this industry In Californiarsquos new program up to$10 million will be dedicated to helping equity appli-cants including grants for startup and ongoing costsOf course when thinking about these programs aseconomic engines in certain communities one mustalso consider what the price drops will mean for theeconomic viability of those given preferred licensesA complementary or alternative approach would be toimpose a THC tax that would not be as sensitive toprice drops and dedicate some of that revenue to evi-dence-based programs that can improve economicopportunities for groups andor communities dispro-portionately affected by cannabis prohibition The pricedrop could also be mitigated by allowing the govern-ment to sell the product andor set the price (61)

Permanency

None of the changes made to cannabis policy need bepermanent whether it is through ballot initiatives orthe more traditional legislative process however open-ing the market to profit-maximizing firms makes itharder to make any changes that could significantly

affect their bottom line As noted above cautious jur-isdictions seeking alternatives to prohibiting cannabissupply may want to consider some of the middle-ground options presented in Figure 1

Issues of permanency also apply to regulations andproduct availability Jurisdictions do not have to allowall cannabis products to be made available for purchaseon Day 1 this is a choice For example those skepticalabout creating a market (and associated advertising) forhigh-potency waxes could continue prohibiting themwith a sunset clause that will end the ban after a fixedperiod of time unless it is extended by the legislatureSome jurisdictions may also want to impose a similarsunset clause with respect to on-premises consumptionsince it is unclear what this means for overall impaireddriving (62) however they will need to weigh thisagainst the problems associated with legalizing canna-bis but banning public consumption

Concluding thoughts

Creating a new legal regime for cannabis supply iscomplex This article highlights 14 of the main choicesthere are obviously others The bottom line is thatjurisdictions have many options and they should notfeel as if the Colorado and Washington models thathave been replicated in some US states are the onlyapproaches for implementing an alternative to cannabissupply prohibition

These 14 Ps should also serve as a warning for analystsconducting research on legalization Using a simple bin-ary variable indicating whether a jurisdiction has lega-lized or not in a standard differences-in-differencesframework is not only crude but it could lead to incor-rect inferences if the jurisdictions have made differentchoices about these factors (63) Researchers must alsoconsider that states will likely adjust regulations overtime which could have important implications forhealth safety andor social equity

Financial disclosures

The author reports no relevant financial conflicts

Funding

National Institute on Drug Abuse (R01DA040924)

References

1 Caulkins JP Hawken A Kilmer B Kleiman MAMarijuana legalization what everyone needs to knowNew York (NY) Oxford University Press 2012

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 7

2 Rolles S Murkin G How to regulate cannabis a prac-tical guide Transform Drug Policy Foundation 2013

3 Caulkins JP Kilmer B Kleiman MA MacCoun RJMidgette G Oglesby P Pacula RL Reuter PHConsidering marijuana legalization insights forVermont and other jurisdictions Santa Monica (CA)Rand Corporation 2015 Report No RR-864

4 Pacula RL Kilmer B Wagenaar AC Chaloupka FJCaulkins JP Developing public health regulations formarijuana lessons from alcohol and tobacco AmJ Public Health 20141041021ndash28 doi102105AJPH2013301766

5 Kilmer B Policy designs for cannabis legalizationstarting with the eight Ps Am J Drug Alcohol Abuse201440259ndash61 doi103109009529902014894047

6 Kilmer B The ldquo10 Psrdquo of Marijuana LegalizationBerkeley Rev Latin Am Stud 20155455

7 Kilmer B Caulkins JP Pacula RL MacCoun RJReuter P Altered state assessing how marijuana lega-lization in California could influence marijuana con-sumption and public budgets Santa Monica (CA)RAND Corporation 2010

8 Reuter P Kleiman MA Risks and prices an economicanalysis of drug enforcement Crime Justice19867289ndash340 doi101086449116

9 Caulkins J Effects of prohibition enforcement and inter-diction on drug use In Quah Collins Atuesta BecerraCaulkins J Csete J Drucker E Felbab-Brown V et aleds Ending the drug wars report of the LSE ExpertGroup on the economics of drug policy 201416ndash24httpwwwlseacukideasAssetsDocumentsreportsLSE-IDEAS-Ending-the-Drug-Warspdf

10 Colorado Department of Revenue Current amp priorretail marijuana average market rates (Median marketprices) 2019 httpswwwcoloradogovpacificsitesdefaultfilesAMR_CurrentAndPriorRates_Jul2019pdf

11 Cannabis Benchmarks 2018 ldquoCannabis BenchmarksSpot Price Indicies The Big Four vs The USrdquoSeptember httpswwwcannabisbenchmarkscom

12 Kleiman M Hampsher S Davenport S Manning CHeussler L Interviews with cannabis licensees inWashington State New York BOTEC AnalysisForthcoming

13 Cherney MA Cannabis is now legal in Canada but potcompanies expect a rocky start MarketWatch 2018httpswwwmarketwatchcomstorycannabis-is-now-legal-in-canada-but-pot-companies-expect-a-rocky-start-2018-10-17

14 Government of Canada Canada Go Cannabis in theprovinces and territories Canada government ofCanada 2018a [accessed 2018 Oct 22 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsprovinces-territorieshtml

15 Kilmer B Everingham S Caulkins J Midgette GPacula R Reuter P Burns R et al What Americarsquosusers spend on illegal drugs 2000ndash2010 Prepared forthe Office of National Drug Control PolicyWashington (DC) RAND Corporation 2014

16 Caulkins JP Kilmer B Kleiman MA Marijuana legali-zation what everyone needs to know 2nd edNew York Oxford University Press 2016

17 Caulkins JP Kilmer B Considering marijuana legaliza-tion carefully insights for other jurisdictions fromanalysis for Vermont Addiction 2016Dec1112082ndash89 doi101111add13289

18 Wilkins C After the legalisation of cannabis the CannabisIncorporated Society (CIS) regulatory model for recrea-tional cannabis in New Zealand NZ Med J201612917ndash20

19 Cerdaacute M Kilmer B Uruguayrsquos middle-groundapproach to cannabis legalization Int J Drug Policy201742118ndash20 doi101016jdrugpo201702007

20 Pardo B Cannabis policy reforms in the Americasa comparative analysis of Colorado Washington andUruguay Int J Drug Policy 201425727ndash35doi101016jdrugpo201405010

21 Walsh J Ramsey G Uruguayrsquos drug policy majorinnovations major challenges WashingtonBrookings 2015 httpwww brookingsedu~mediaResearchFilesPapers201504global-drug-policyWalshndashUruguay-finalpdf

22 Wilson JQ Bureaucracy what government agencies doand why they do it New York (NY) Basic Books 1989

23 Alaska Department of Commerce Community andEconomic Development Marijuana control boardmembers 2019 httpswwwcommercealaskagovwebamcoMCBMembersaspx

24 Warner K Selling smoke cigarette advertising andpublic health Amer Public Health Association 1986

25 Saffer H Studying the effects of alcohol advertising onconsumption AlcoholHealth ResWorld 199620266ndash272

26 MacCoun RJ Reuter P Drug war heresies learningfrom other vices times and places CambridgeUniversity Press 2001

27 Bird MG The Rise of the Liquor Control Board ofOntario 1985-2009 Can Political Sci Rev 201041ndash17

28 Government of Canada Canada Go Regulations tosupport coming into force of the Cannabis ActCanada government of Canada 2018b [accessed 2018July 11 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsregulations-support-cannabis-acthtml

29 Ingold J To educate people about marijuana Coloradohealth officals tried ads with a radically friendly toneDid it work The denver post [Internet] 2018 httpswwwdenverpostcom20180122colorado-marijuana-education-advertising

30 Crawford K Colorado Department of Public Health ampEnvironment (CDPHE) Retail Marijuana EducationProgram 2017 annual reportDenver (CO)CDPHE 2018

31 Branan B Public safety agencies launch drugged drivingcampaign in advance of legalized marijuanaSacramento Bee 2017 httpswwwsacbeecomnewslocalarticle191881659html

32 National Inventory of Collateral Consequences ofConviction 2018 httpsniccccsgjusticecenterorg

33 Southern Poverty Law Center Alabamalsquos war on mar-ijuana assessing the fiscal and human toll on crimina-lization Montgomery (AL) Southern Poverty LawCenter 2018

34 Subbaraman M Substitution and complementarity ofalcohol and cannabis a review of the literature Subst

8 B KILMER

about 2 THC to be sold in the pharmacies but this waseventually increased to 9 THC

Canadarsquos legalization task force which produced thereport that served as the basis for the legislation thatwas eventually passed (51) put a lot of emphasis onpotency recommending that regulators ldquoDevelop stra-tegies to encourage consumption of less potent canna-bis including a price and tax scheme based on potencyto discourage purchase of high-potency productsrdquo

Purity

Just as jurisdictions will need to develop protocols fortesting and labeling for cannabinoids they will alsohave to make decisions about and develop protocolsfor the types of pesticides that can be used and otherlevels of impurities (eg mold bacteria metals) Thisnot only has health implications for consumers but itcan also create health risks for those working in thecannabis industry (5253)

Because of the federal prohibition in the US the agencygenerally tasked with developing regulations about pesti-cides and tolerances (Environmental Protection Agency)has not weighed in on cannabis This has left it up tovarious state agencies to make these decisions aboutimpurities creating a patchwork of regulations (see eg54) In contrast Canadarsquos federally regulated producersare all subject to the same regulations regardless of loca-tion In November 2018 the CanadianMinistry of Health(2018) published the list and limits of active ingredientswhich can differ depending on whether the product isfresh cannabis and plants dried cannabis or cannabis oil

Jurisdictions will also have to decide whether certainsubstances (eg alcohol and tobacco) can be mixed andsold with cannabis Since the overall health effects of can-nabis legalization will be shaped by what happens to theconsumption of alcohol opioids tobacco and other sub-stances (16) this decision could have important implica-tions for health So far no jurisdiction has allowed cannabisproducts to be infused with alcohol or tobacco In factmost places do not allow cannabis to be sold in stores thatsell alcohol or tobacco (Nova Scotia which sells both alco-hol and cannabis in the same state-run stores is a notableexception) But with some alcohol and some tobacco-related industries making significant investments in can-nabis producers in Canada it is reasonable to ask how longthis prohibition on mixing products will last

Price

Many of the outcomes that get discussed in legalizationdebates ndash the size of the illicit market consumption taxrevenues business profits ndash will be shaped by the post-

tax retail price of cannabis after legalization (3755) Asdiscussed earlier there are several reasons to expect theproduction costs to plummet after legalization how-ever jurisdictions have several tools they could use toincrease the retail price if they desire Minimize com-petition (eg limit wholesale andor retail market tothe government) set the price set a minimum pricelimit quantity discounts (eg by limiting the amountthat can be purchased) levy taxes and fees imposecostly regulations (eg thorough testing and labellingregimes)

Currently Uruguay is the only jurisdiction to date thatsets the price of the cannabis products sold and limits theamount individual can purchase at 10 g per week Canadaand all US jurisdictions limit the amount that can bepurchased in one transaction require some type of testing(some more rigorous than others) and impose taxes Inmany places these are ad valorem taxes which area function of price but there are several ways to taxcannabis (35556) Indeed one of the limits of price-based taxes is that revenue will decline as the price fallsunless there is a corresponding increase in consumption

An alternative approach is to tax cannabis asa function of its THC content (35557) This wouldbe similar to how the US federal government taxesliquor ndash as a function of its alcohol content The 2019Canadian Budget proposes to a tax of $001 per milli-gram of total THC for cannabis edibles extracts (whichwill include oils) and topicals (58) One advantage ofthis approach is that tax revenue would not fall asmarket prices decrease If the THC tax was progressive(ie the rate increases as the amount of THC in theproduct increases) it would make it easier for govern-ments to nudge consumers toward lower-potency pro-ducts One could also imagine taxes based on THCCBD ratios or other combinations of chemicals

If the testing and labeling regime is reliable ina jurisdiction ndash and this is a big if ndash then taxing asa function of THC (or some other combination of canna-binoids) should not be difficult But as Kilmer (46) notesldquoif the testing regimes yields inconsistent results or thesystem can be corrupted this creates challenges for label-ing and levying THC taxes In this situation jurisdictionscould consider using the company-stated THC level as thebase for an alternative minimum taxrdquo

Preferences for licenses

If jurisdictions decide to legalize and license commer-cial activity they will have to decide how to distributethose licenses Like those applying for alcohol licensesRegular business licenses To the highest bidders Orshould they give preferences to non-profits or for-

6 B KILMER

benefit corporations that are not driven solely byprofit To small businesses Something else As dis-cussed in the Profit Motive section this could haveimportant implications for the health and economicconsequences of legalization

With a goal of advancing social equity outcomesthere has been a movement in some jurisdictions togive preferences for business licenses to those who havebeen most harmed by cannabis prohibition (eg thosewho live in communities where a disproportionatenumber of arrests took place those from certainracialethnic groups andor those were previously con-victed of a cannabis offense) Oaklandrsquos first retail storeoperated by an equity applicant opened inNovember 2018 (40) San Franciscorsquos program is stillbeing implemented (59) and the licensed retail storesare just opening in Massachusetts thus it is too early toknow whether these programs have achieved their goalof building wealth and creating economic opportunitiesfor those preferred groups As part of its medical can-nabis program the state of Ohio sought to make sure atleast 15 of the licenses went to minority-owned firmshowever this provision was legally challenged anda judge recently ruled it unconstitutional (60)Whether this decision is upheld remains to be seenbut it highlights one challenge those developing socialequity programs may need to overcome

Another potential challenge is whether those groupsreceiving preferences for licenses have access to capitaland other forms of business assistance to be successfulin this industry In Californiarsquos new program up to$10 million will be dedicated to helping equity appli-cants including grants for startup and ongoing costsOf course when thinking about these programs aseconomic engines in certain communities one mustalso consider what the price drops will mean for theeconomic viability of those given preferred licensesA complementary or alternative approach would be toimpose a THC tax that would not be as sensitive toprice drops and dedicate some of that revenue to evi-dence-based programs that can improve economicopportunities for groups andor communities dispro-portionately affected by cannabis prohibition The pricedrop could also be mitigated by allowing the govern-ment to sell the product andor set the price (61)

Permanency

None of the changes made to cannabis policy need bepermanent whether it is through ballot initiatives orthe more traditional legislative process however open-ing the market to profit-maximizing firms makes itharder to make any changes that could significantly

affect their bottom line As noted above cautious jur-isdictions seeking alternatives to prohibiting cannabissupply may want to consider some of the middle-ground options presented in Figure 1

Issues of permanency also apply to regulations andproduct availability Jurisdictions do not have to allowall cannabis products to be made available for purchaseon Day 1 this is a choice For example those skepticalabout creating a market (and associated advertising) forhigh-potency waxes could continue prohibiting themwith a sunset clause that will end the ban after a fixedperiod of time unless it is extended by the legislatureSome jurisdictions may also want to impose a similarsunset clause with respect to on-premises consumptionsince it is unclear what this means for overall impaireddriving (62) however they will need to weigh thisagainst the problems associated with legalizing canna-bis but banning public consumption

Concluding thoughts

Creating a new legal regime for cannabis supply iscomplex This article highlights 14 of the main choicesthere are obviously others The bottom line is thatjurisdictions have many options and they should notfeel as if the Colorado and Washington models thathave been replicated in some US states are the onlyapproaches for implementing an alternative to cannabissupply prohibition

These 14 Ps should also serve as a warning for analystsconducting research on legalization Using a simple bin-ary variable indicating whether a jurisdiction has lega-lized or not in a standard differences-in-differencesframework is not only crude but it could lead to incor-rect inferences if the jurisdictions have made differentchoices about these factors (63) Researchers must alsoconsider that states will likely adjust regulations overtime which could have important implications forhealth safety andor social equity

Financial disclosures

The author reports no relevant financial conflicts

Funding

National Institute on Drug Abuse (R01DA040924)

References

1 Caulkins JP Hawken A Kilmer B Kleiman MAMarijuana legalization what everyone needs to knowNew York (NY) Oxford University Press 2012

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 7

2 Rolles S Murkin G How to regulate cannabis a prac-tical guide Transform Drug Policy Foundation 2013

3 Caulkins JP Kilmer B Kleiman MA MacCoun RJMidgette G Oglesby P Pacula RL Reuter PHConsidering marijuana legalization insights forVermont and other jurisdictions Santa Monica (CA)Rand Corporation 2015 Report No RR-864

4 Pacula RL Kilmer B Wagenaar AC Chaloupka FJCaulkins JP Developing public health regulations formarijuana lessons from alcohol and tobacco AmJ Public Health 20141041021ndash28 doi102105AJPH2013301766

5 Kilmer B Policy designs for cannabis legalizationstarting with the eight Ps Am J Drug Alcohol Abuse201440259ndash61 doi103109009529902014894047

6 Kilmer B The ldquo10 Psrdquo of Marijuana LegalizationBerkeley Rev Latin Am Stud 20155455

7 Kilmer B Caulkins JP Pacula RL MacCoun RJReuter P Altered state assessing how marijuana lega-lization in California could influence marijuana con-sumption and public budgets Santa Monica (CA)RAND Corporation 2010

8 Reuter P Kleiman MA Risks and prices an economicanalysis of drug enforcement Crime Justice19867289ndash340 doi101086449116

9 Caulkins J Effects of prohibition enforcement and inter-diction on drug use In Quah Collins Atuesta BecerraCaulkins J Csete J Drucker E Felbab-Brown V et aleds Ending the drug wars report of the LSE ExpertGroup on the economics of drug policy 201416ndash24httpwwwlseacukideasAssetsDocumentsreportsLSE-IDEAS-Ending-the-Drug-Warspdf

10 Colorado Department of Revenue Current amp priorretail marijuana average market rates (Median marketprices) 2019 httpswwwcoloradogovpacificsitesdefaultfilesAMR_CurrentAndPriorRates_Jul2019pdf

11 Cannabis Benchmarks 2018 ldquoCannabis BenchmarksSpot Price Indicies The Big Four vs The USrdquoSeptember httpswwwcannabisbenchmarkscom

12 Kleiman M Hampsher S Davenport S Manning CHeussler L Interviews with cannabis licensees inWashington State New York BOTEC AnalysisForthcoming

13 Cherney MA Cannabis is now legal in Canada but potcompanies expect a rocky start MarketWatch 2018httpswwwmarketwatchcomstorycannabis-is-now-legal-in-canada-but-pot-companies-expect-a-rocky-start-2018-10-17

14 Government of Canada Canada Go Cannabis in theprovinces and territories Canada government ofCanada 2018a [accessed 2018 Oct 22 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsprovinces-territorieshtml

15 Kilmer B Everingham S Caulkins J Midgette GPacula R Reuter P Burns R et al What Americarsquosusers spend on illegal drugs 2000ndash2010 Prepared forthe Office of National Drug Control PolicyWashington (DC) RAND Corporation 2014

16 Caulkins JP Kilmer B Kleiman MA Marijuana legali-zation what everyone needs to know 2nd edNew York Oxford University Press 2016

17 Caulkins JP Kilmer B Considering marijuana legaliza-tion carefully insights for other jurisdictions fromanalysis for Vermont Addiction 2016Dec1112082ndash89 doi101111add13289

18 Wilkins C After the legalisation of cannabis the CannabisIncorporated Society (CIS) regulatory model for recrea-tional cannabis in New Zealand NZ Med J201612917ndash20

19 Cerdaacute M Kilmer B Uruguayrsquos middle-groundapproach to cannabis legalization Int J Drug Policy201742118ndash20 doi101016jdrugpo201702007

20 Pardo B Cannabis policy reforms in the Americasa comparative analysis of Colorado Washington andUruguay Int J Drug Policy 201425727ndash35doi101016jdrugpo201405010

21 Walsh J Ramsey G Uruguayrsquos drug policy majorinnovations major challenges WashingtonBrookings 2015 httpwww brookingsedu~mediaResearchFilesPapers201504global-drug-policyWalshndashUruguay-finalpdf

22 Wilson JQ Bureaucracy what government agencies doand why they do it New York (NY) Basic Books 1989

23 Alaska Department of Commerce Community andEconomic Development Marijuana control boardmembers 2019 httpswwwcommercealaskagovwebamcoMCBMembersaspx

24 Warner K Selling smoke cigarette advertising andpublic health Amer Public Health Association 1986

25 Saffer H Studying the effects of alcohol advertising onconsumption AlcoholHealth ResWorld 199620266ndash272

26 MacCoun RJ Reuter P Drug war heresies learningfrom other vices times and places CambridgeUniversity Press 2001

27 Bird MG The Rise of the Liquor Control Board ofOntario 1985-2009 Can Political Sci Rev 201041ndash17

28 Government of Canada Canada Go Regulations tosupport coming into force of the Cannabis ActCanada government of Canada 2018b [accessed 2018July 11 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsregulations-support-cannabis-acthtml

29 Ingold J To educate people about marijuana Coloradohealth officals tried ads with a radically friendly toneDid it work The denver post [Internet] 2018 httpswwwdenverpostcom20180122colorado-marijuana-education-advertising

30 Crawford K Colorado Department of Public Health ampEnvironment (CDPHE) Retail Marijuana EducationProgram 2017 annual reportDenver (CO)CDPHE 2018

31 Branan B Public safety agencies launch drugged drivingcampaign in advance of legalized marijuanaSacramento Bee 2017 httpswwwsacbeecomnewslocalarticle191881659html

32 National Inventory of Collateral Consequences ofConviction 2018 httpsniccccsgjusticecenterorg

33 Southern Poverty Law Center Alabamalsquos war on mar-ijuana assessing the fiscal and human toll on crimina-lization Montgomery (AL) Southern Poverty LawCenter 2018

34 Subbaraman M Substitution and complementarity ofalcohol and cannabis a review of the literature Subst

8 B KILMER

benefit corporations that are not driven solely byprofit To small businesses Something else As dis-cussed in the Profit Motive section this could haveimportant implications for the health and economicconsequences of legalization

With a goal of advancing social equity outcomesthere has been a movement in some jurisdictions togive preferences for business licenses to those who havebeen most harmed by cannabis prohibition (eg thosewho live in communities where a disproportionatenumber of arrests took place those from certainracialethnic groups andor those were previously con-victed of a cannabis offense) Oaklandrsquos first retail storeoperated by an equity applicant opened inNovember 2018 (40) San Franciscorsquos program is stillbeing implemented (59) and the licensed retail storesare just opening in Massachusetts thus it is too early toknow whether these programs have achieved their goalof building wealth and creating economic opportunitiesfor those preferred groups As part of its medical can-nabis program the state of Ohio sought to make sure atleast 15 of the licenses went to minority-owned firmshowever this provision was legally challenged anda judge recently ruled it unconstitutional (60)Whether this decision is upheld remains to be seenbut it highlights one challenge those developing socialequity programs may need to overcome

Another potential challenge is whether those groupsreceiving preferences for licenses have access to capitaland other forms of business assistance to be successfulin this industry In Californiarsquos new program up to$10 million will be dedicated to helping equity appli-cants including grants for startup and ongoing costsOf course when thinking about these programs aseconomic engines in certain communities one mustalso consider what the price drops will mean for theeconomic viability of those given preferred licensesA complementary or alternative approach would be toimpose a THC tax that would not be as sensitive toprice drops and dedicate some of that revenue to evi-dence-based programs that can improve economicopportunities for groups andor communities dispro-portionately affected by cannabis prohibition The pricedrop could also be mitigated by allowing the govern-ment to sell the product andor set the price (61)

Permanency

None of the changes made to cannabis policy need bepermanent whether it is through ballot initiatives orthe more traditional legislative process however open-ing the market to profit-maximizing firms makes itharder to make any changes that could significantly

affect their bottom line As noted above cautious jur-isdictions seeking alternatives to prohibiting cannabissupply may want to consider some of the middle-ground options presented in Figure 1

Issues of permanency also apply to regulations andproduct availability Jurisdictions do not have to allowall cannabis products to be made available for purchaseon Day 1 this is a choice For example those skepticalabout creating a market (and associated advertising) forhigh-potency waxes could continue prohibiting themwith a sunset clause that will end the ban after a fixedperiod of time unless it is extended by the legislatureSome jurisdictions may also want to impose a similarsunset clause with respect to on-premises consumptionsince it is unclear what this means for overall impaireddriving (62) however they will need to weigh thisagainst the problems associated with legalizing canna-bis but banning public consumption

Concluding thoughts

Creating a new legal regime for cannabis supply iscomplex This article highlights 14 of the main choicesthere are obviously others The bottom line is thatjurisdictions have many options and they should notfeel as if the Colorado and Washington models thathave been replicated in some US states are the onlyapproaches for implementing an alternative to cannabissupply prohibition

These 14 Ps should also serve as a warning for analystsconducting research on legalization Using a simple bin-ary variable indicating whether a jurisdiction has lega-lized or not in a standard differences-in-differencesframework is not only crude but it could lead to incor-rect inferences if the jurisdictions have made differentchoices about these factors (63) Researchers must alsoconsider that states will likely adjust regulations overtime which could have important implications forhealth safety andor social equity

Financial disclosures

The author reports no relevant financial conflicts

Funding

National Institute on Drug Abuse (R01DA040924)

References

1 Caulkins JP Hawken A Kilmer B Kleiman MAMarijuana legalization what everyone needs to knowNew York (NY) Oxford University Press 2012

THE AMERICAN JOURNAL OF DRUG AND ALCOHOL ABUSE 7

2 Rolles S Murkin G How to regulate cannabis a prac-tical guide Transform Drug Policy Foundation 2013

3 Caulkins JP Kilmer B Kleiman MA MacCoun RJMidgette G Oglesby P Pacula RL Reuter PHConsidering marijuana legalization insights forVermont and other jurisdictions Santa Monica (CA)Rand Corporation 2015 Report No RR-864

4 Pacula RL Kilmer B Wagenaar AC Chaloupka FJCaulkins JP Developing public health regulations formarijuana lessons from alcohol and tobacco AmJ Public Health 20141041021ndash28 doi102105AJPH2013301766

5 Kilmer B Policy designs for cannabis legalizationstarting with the eight Ps Am J Drug Alcohol Abuse201440259ndash61 doi103109009529902014894047

6 Kilmer B The ldquo10 Psrdquo of Marijuana LegalizationBerkeley Rev Latin Am Stud 20155455

7 Kilmer B Caulkins JP Pacula RL MacCoun RJReuter P Altered state assessing how marijuana lega-lization in California could influence marijuana con-sumption and public budgets Santa Monica (CA)RAND Corporation 2010

8 Reuter P Kleiman MA Risks and prices an economicanalysis of drug enforcement Crime Justice19867289ndash340 doi101086449116

9 Caulkins J Effects of prohibition enforcement and inter-diction on drug use In Quah Collins Atuesta BecerraCaulkins J Csete J Drucker E Felbab-Brown V et aleds Ending the drug wars report of the LSE ExpertGroup on the economics of drug policy 201416ndash24httpwwwlseacukideasAssetsDocumentsreportsLSE-IDEAS-Ending-the-Drug-Warspdf

10 Colorado Department of Revenue Current amp priorretail marijuana average market rates (Median marketprices) 2019 httpswwwcoloradogovpacificsitesdefaultfilesAMR_CurrentAndPriorRates_Jul2019pdf

11 Cannabis Benchmarks 2018 ldquoCannabis BenchmarksSpot Price Indicies The Big Four vs The USrdquoSeptember httpswwwcannabisbenchmarkscom

12 Kleiman M Hampsher S Davenport S Manning CHeussler L Interviews with cannabis licensees inWashington State New York BOTEC AnalysisForthcoming

13 Cherney MA Cannabis is now legal in Canada but potcompanies expect a rocky start MarketWatch 2018httpswwwmarketwatchcomstorycannabis-is-now-legal-in-canada-but-pot-companies-expect-a-rocky-start-2018-10-17

14 Government of Canada Canada Go Cannabis in theprovinces and territories Canada government ofCanada 2018a [accessed 2018 Oct 22 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsprovinces-territorieshtml

15 Kilmer B Everingham S Caulkins J Midgette GPacula R Reuter P Burns R et al What Americarsquosusers spend on illegal drugs 2000ndash2010 Prepared forthe Office of National Drug Control PolicyWashington (DC) RAND Corporation 2014

16 Caulkins JP Kilmer B Kleiman MA Marijuana legali-zation what everyone needs to know 2nd edNew York Oxford University Press 2016

17 Caulkins JP Kilmer B Considering marijuana legaliza-tion carefully insights for other jurisdictions fromanalysis for Vermont Addiction 2016Dec1112082ndash89 doi101111add13289

18 Wilkins C After the legalisation of cannabis the CannabisIncorporated Society (CIS) regulatory model for recrea-tional cannabis in New Zealand NZ Med J201612917ndash20

19 Cerdaacute M Kilmer B Uruguayrsquos middle-groundapproach to cannabis legalization Int J Drug Policy201742118ndash20 doi101016jdrugpo201702007

20 Pardo B Cannabis policy reforms in the Americasa comparative analysis of Colorado Washington andUruguay Int J Drug Policy 201425727ndash35doi101016jdrugpo201405010

21 Walsh J Ramsey G Uruguayrsquos drug policy majorinnovations major challenges WashingtonBrookings 2015 httpwww brookingsedu~mediaResearchFilesPapers201504global-drug-policyWalshndashUruguay-finalpdf

22 Wilson JQ Bureaucracy what government agencies doand why they do it New York (NY) Basic Books 1989

23 Alaska Department of Commerce Community andEconomic Development Marijuana control boardmembers 2019 httpswwwcommercealaskagovwebamcoMCBMembersaspx

24 Warner K Selling smoke cigarette advertising andpublic health Amer Public Health Association 1986

25 Saffer H Studying the effects of alcohol advertising onconsumption AlcoholHealth ResWorld 199620266ndash272

26 MacCoun RJ Reuter P Drug war heresies learningfrom other vices times and places CambridgeUniversity Press 2001

27 Bird MG The Rise of the Liquor Control Board ofOntario 1985-2009 Can Political Sci Rev 201041ndash17

28 Government of Canada Canada Go Regulations tosupport coming into force of the Cannabis ActCanada government of Canada 2018b [accessed 2018July 11 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsregulations-support-cannabis-acthtml

29 Ingold J To educate people about marijuana Coloradohealth officals tried ads with a radically friendly toneDid it work The denver post [Internet] 2018 httpswwwdenverpostcom20180122colorado-marijuana-education-advertising

30 Crawford K Colorado Department of Public Health ampEnvironment (CDPHE) Retail Marijuana EducationProgram 2017 annual reportDenver (CO)CDPHE 2018

31 Branan B Public safety agencies launch drugged drivingcampaign in advance of legalized marijuanaSacramento Bee 2017 httpswwwsacbeecomnewslocalarticle191881659html

32 National Inventory of Collateral Consequences ofConviction 2018 httpsniccccsgjusticecenterorg

33 Southern Poverty Law Center Alabamalsquos war on mar-ijuana assessing the fiscal and human toll on crimina-lization Montgomery (AL) Southern Poverty LawCenter 2018

34 Subbaraman M Substitution and complementarity ofalcohol and cannabis a review of the literature Subst

8 B KILMER

2 Rolles S Murkin G How to regulate cannabis a prac-tical guide Transform Drug Policy Foundation 2013

3 Caulkins JP Kilmer B Kleiman MA MacCoun RJMidgette G Oglesby P Pacula RL Reuter PHConsidering marijuana legalization insights forVermont and other jurisdictions Santa Monica (CA)Rand Corporation 2015 Report No RR-864

4 Pacula RL Kilmer B Wagenaar AC Chaloupka FJCaulkins JP Developing public health regulations formarijuana lessons from alcohol and tobacco AmJ Public Health 20141041021ndash28 doi102105AJPH2013301766

5 Kilmer B Policy designs for cannabis legalizationstarting with the eight Ps Am J Drug Alcohol Abuse201440259ndash61 doi103109009529902014894047

6 Kilmer B The ldquo10 Psrdquo of Marijuana LegalizationBerkeley Rev Latin Am Stud 20155455

7 Kilmer B Caulkins JP Pacula RL MacCoun RJReuter P Altered state assessing how marijuana lega-lization in California could influence marijuana con-sumption and public budgets Santa Monica (CA)RAND Corporation 2010

8 Reuter P Kleiman MA Risks and prices an economicanalysis of drug enforcement Crime Justice19867289ndash340 doi101086449116

9 Caulkins J Effects of prohibition enforcement and inter-diction on drug use In Quah Collins Atuesta BecerraCaulkins J Csete J Drucker E Felbab-Brown V et aleds Ending the drug wars report of the LSE ExpertGroup on the economics of drug policy 201416ndash24httpwwwlseacukideasAssetsDocumentsreportsLSE-IDEAS-Ending-the-Drug-Warspdf

10 Colorado Department of Revenue Current amp priorretail marijuana average market rates (Median marketprices) 2019 httpswwwcoloradogovpacificsitesdefaultfilesAMR_CurrentAndPriorRates_Jul2019pdf

11 Cannabis Benchmarks 2018 ldquoCannabis BenchmarksSpot Price Indicies The Big Four vs The USrdquoSeptember httpswwwcannabisbenchmarkscom

12 Kleiman M Hampsher S Davenport S Manning CHeussler L Interviews with cannabis licensees inWashington State New York BOTEC AnalysisForthcoming

13 Cherney MA Cannabis is now legal in Canada but potcompanies expect a rocky start MarketWatch 2018httpswwwmarketwatchcomstorycannabis-is-now-legal-in-canada-but-pot-companies-expect-a-rocky-start-2018-10-17

14 Government of Canada Canada Go Cannabis in theprovinces and territories Canada government ofCanada 2018a [accessed 2018 Oct 22 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsprovinces-territorieshtml

15 Kilmer B Everingham S Caulkins J Midgette GPacula R Reuter P Burns R et al What Americarsquosusers spend on illegal drugs 2000ndash2010 Prepared forthe Office of National Drug Control PolicyWashington (DC) RAND Corporation 2014

16 Caulkins JP Kilmer B Kleiman MA Marijuana legali-zation what everyone needs to know 2nd edNew York Oxford University Press 2016

17 Caulkins JP Kilmer B Considering marijuana legaliza-tion carefully insights for other jurisdictions fromanalysis for Vermont Addiction 2016Dec1112082ndash89 doi101111add13289

18 Wilkins C After the legalisation of cannabis the CannabisIncorporated Society (CIS) regulatory model for recrea-tional cannabis in New Zealand NZ Med J201612917ndash20

19 Cerdaacute M Kilmer B Uruguayrsquos middle-groundapproach to cannabis legalization Int J Drug Policy201742118ndash20 doi101016jdrugpo201702007

20 Pardo B Cannabis policy reforms in the Americasa comparative analysis of Colorado Washington andUruguay Int J Drug Policy 201425727ndash35doi101016jdrugpo201405010

21 Walsh J Ramsey G Uruguayrsquos drug policy majorinnovations major challenges WashingtonBrookings 2015 httpwww brookingsedu~mediaResearchFilesPapers201504global-drug-policyWalshndashUruguay-finalpdf

22 Wilson JQ Bureaucracy what government agencies doand why they do it New York (NY) Basic Books 1989

23 Alaska Department of Commerce Community andEconomic Development Marijuana control boardmembers 2019 httpswwwcommercealaskagovwebamcoMCBMembersaspx

24 Warner K Selling smoke cigarette advertising andpublic health Amer Public Health Association 1986

25 Saffer H Studying the effects of alcohol advertising onconsumption AlcoholHealth ResWorld 199620266ndash272

26 MacCoun RJ Reuter P Drug war heresies learningfrom other vices times and places CambridgeUniversity Press 2001

27 Bird MG The Rise of the Liquor Control Board ofOntario 1985-2009 Can Political Sci Rev 201041ndash17

28 Government of Canada Canada Go Regulations tosupport coming into force of the Cannabis ActCanada government of Canada 2018b [accessed 2018July 11 httpswwwcanadacaenhealth-canadaservicesdrugs-medicationcannabislaws-regulationsregulations-support-cannabis-acthtml

29 Ingold J To educate people about marijuana Coloradohealth officals tried ads with a radically friendly toneDid it work The denver post [Internet] 2018 httpswwwdenverpostcom20180122colorado-marijuana-education-advertising

30 Crawford K Colorado Department of Public Health ampEnvironment (CDPHE) Retail Marijuana EducationProgram 2017 annual reportDenver (CO)CDPHE 2018

31 Branan B Public safety agencies launch drugged drivingcampaign in advance of legalized marijuanaSacramento Bee 2017 httpswwwsacbeecomnewslocalarticle191881659html

32 National Inventory of Collateral Consequences ofConviction 2018 httpsniccccsgjusticecenterorg

33 Southern Poverty Law Center Alabamalsquos war on mar-ijuana assessing the fiscal and human toll on crimina-lization Montgomery (AL) Southern Poverty LawCenter 2018

34 Subbaraman M Substitution and complementarity ofalcohol and cannabis a review of the literature Subst

8 B KILMER

Use Misuse 2016511399ndash414 doi1031091082608420161170145

35 Guttmannova K Lee CM Kilmer JR Fleming CBRhew IC Kosterman R Larimer ME Impacts of chan-ging marijuana policies on alcohol use in the UnitedStates Alcoholism 20164033ndash46

36 Kleiman MA Jones T Miller C Halperin R Drivingwhile stoned issues and policy options J Drug PolicyAnal 2018112 doi101515jdpa-2018-0004

37 Wells J Canadalsquos proposed approach to drug-impairedd r i v i n g b i l l C - 4 6 h t t p s www p a r l c a DocumentVieweren42-1billC-46royal-assent

38 Courts C Proposition 64 the adult use of marijuanaact California California Courts The Judicial Branchof California 2016 Nov 9

39 California Assembly Bill No 1793 October 1 2018httpsleginfolegislaturecagovfacesbillTextClientxhtmlbill_id=201720180AB1793

40 Downs D Oakland cannabis equity program yields firstretailermdashBlunts + Moore Leafly [Internet] 2018 httpswwwleaflycomnewsindustryoakland-cannabis-equity-program-yields-first-retailer-blunts-moore

41 Smart R Caulkins JP Kilmer B Davenport S MidgetteG Variation in cannabis potency and prices in a newlylegal market evidence from 30 million cannabis salesin Washington State Addiction 20171122167ndash2177

42 Orens A Light M Lewandowski B Rowberry J SalogaC Market size and demand for marijuana in Colorado2017 market update 2018 httpswwwcoloradogovpacificsitesdefaultfilesMED20Demand20and20Market2020Study2020082018pdf

43 Russell C Rueda S Room R Tyndall M Fischer BRoutes of administration for cannabis usendashbasic pre-valence and related health outcomes A scoping reviewand synthesis Int J Drug Policy 20185287ndash96doi101016jdrugpo201711008

44 Kilmer B Recreational cannabismdashminimizing thehealth risks from legalization N Engl J Med2017376705ndash07 doi101056NEJMp1614783

45 Englund A Freeman TP Murray RM McGuire P Canwe make cannabis safer Lancet Psychiatry20174643ndash48 doi101016S2215-0366(17)30075-5

46 Kilmer B Should Canada ldquostart low and go slowrdquo whenit comes to cannabis potency Santa Monica (CA)RAND Corporation 2018 Report No CT-492

47 Stogner JM Miller BL The dabbing dilemma a call forresearch on butane hash oil and other alternate formsof cannabis use Subst Abuse 201536393ndash95doi1010800889707720151071724

48 Meier MH Associations between butane hash oil useand cannabis-related problems Drug Alcohol Depend201717925ndash31 doi101016jdrugalcdep201706015

49 van der Pol P Liebregts N Brunt T van Amsterdam J deGraaf R Korf DJ van den Brink W van Laar M Cross-sectional and prospective relation of cannabis potency

dosing and smoking behaviour with cannabis depen-dence an ecological study Addiction 20141091101ndash09

50 Freeman TP Morgan CJ Hindocha C Schafer GDas RK Curran HV Just say lsquoknowrsquo how do canna-binoid concentrations influence userslsquo estimates of can-nabis potency and the amount they roll in jointsAddiction 20141091686ndash94 doi101111add12634

51 Wilson-Raybould J Legalization C RegulationA framework for the legalization and regulation ofcannabis in Canada the final report of the task forceon cannabis legalization and regulation OttawaCanada Government of Canada 2016

52 Stone D Cannabis pesticides and conflicting laws thedilemma for legalized States and implications for pub-lic health Regul Toxicol Pharm 201469284ndash88doi101016jyrtph201405015

53 Subritzky T Pettigrew S Lenton S Into the voidregulating pesticide use in Coloradorsquos commercial can-nabis markets Int J Drug Policy 20174286ndash96doi101016jdrugpo201701014

54 Rough L Leaflyrsquos state-by-state guide to cannabis test-ing regulations Leafly 2016 httpswwwleaflycomnewsindustryleaflys-state-by-state-guide-to-cannabis-testing-regulations

55 Caulkins JP Hawken A Kilmer B Kleiman MAPfrommer K Pruess J Shaw T High High tax statesoptions for gleaning revenue from legal cannabisOregon Law Rev 2013911041ndash67

56 Oglesby P Laws to tax marijuana (how to tax it) StateTax Notes 201159251ndash280

57 MacCoun RJ California assembly bill 390 and the taxand regulate ballot initiative what would happen ifCalifornia legalized marijuana presentation at thefourth annual conference of the International Societyfor the Study of Drug Policy 2010 Santa Monica (CA)

58 Department of Finance Canada Investing in the mid-dle class BUDGET 2019 2019 httpsbudgetgcca2019docsplanbudget-2019-enpdf

59 Sabatini J Those impacted by the War on Drugs stillwait for cannabis permits in SF San Francisco exam-iner 2018 httpwwwsfexaminercomimpacted-racist-war-drugs-still-wait-cannabis-permits-sf

60 Associated Press Judge strikes down statersquos marijuanaprogram lsquoracial quotarsquo 2018 httpswwwapnewscom917d36ddc77442f4b2917560fb159808

61 Kilmer B Kleiman M Navigating cannabis legalization20 The Hill 2018 Dec 4

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