Legalize Marijuana
Tracy Murphy
Topic Paper 1:
Supply and Demand - Legalized and Taxed Marijuana
Presented to:
Professor David Barch
In Partial Fulfillment of the Requirements of:
Managerial Economics
Spring II
March 23, 2014
Supply and Demand - Legalized and Taxed Marijuana
The war on drugs has been a battle for years, as a great deal of resources go into catching those who buy or sell illegal drugs on the black market, prosecuting them in court, and housing them in jail. These costs seem particularly exorbitant when dealing with the drug marijuana, as it is widely used, and is likely no more harmful than currently legal drugs such as tobacco and alcohol. There 's another cost to the war on drugs, however, which is the revenue lost by governments who cannot collect taxes on illegal drugs. Although there will be positives and negatives regarding Marijuana legalization per Poltonowicz, J. (2014) this may spur America’s next great industry. Oil, railroads, aviation, automobiles, finance and the personal computer. Marijuana could join this list, as it is expected to be one of America’s next great industries. In what is being called a billion-dollar green rush, analysts are now projecting a 64 percent increase in the marijuana market to $2.34 billion. Analysts are also projecting a five-year increase in the marijuana market to $10.2 billion.
With recent talk about legalizing marijuana many states are not on board however there are some that have made it legal. So, I thought it would be an interesting topic to discuss regarding the supply and demand of legalized marijuana in Colorado since it earlier news and topic discussions they have received many interesting stories of buyers traveling from there because of the price associated with legalizing it that they prefer to purchase in the black market at the cheaper price. According to Moffatt, M. (2014) the study estimates that the average price of 0.5 grams (a unit) of marijuana sold for $8.60
Topic Paper 1:
Supply and Demand - Legalized and Taxed Marijuana
Presented to:
Professor David Barch
In Partial Fulfillment of the Requirements of:
Managerial Economics
Spring II
March 23, 2014
Supply and Demand - Legalized and Taxed Marijuana
The war on drugs has been a battle for years, as a great deal of resources go into catching those who buy or sell illegal drugs on the black market, prosecuting them in court, and housing them in jail. These costs seem particularly exorbitant when dealing with the drug marijuana, as it is widely used, and is likely no more harmful than currently legal drugs such as tobacco and alcohol. There 's another cost to the war on drugs, however, which is the revenue lost by governments who cannot collect taxes on illegal drugs. Although there will be positives and negatives regarding Marijuana legalization per Poltonowicz, J. (2014) this may spur America’s next great industry. Oil, railroads, aviation, automobiles, finance and the personal computer. Marijuana could join this list, as it is expected to be one of America’s next great industries. In what is being called a billion-dollar green rush, analysts are now projecting a 64 percent increase in the marijuana market to $2.34 billion. Analysts are also projecting a five-year increase in the marijuana market to $10.2 billion.
With recent talk about legalizing marijuana many states are not on board however there are some that have made it legal. So, I thought it would be an interesting topic to discuss regarding the supply and demand of legalized marijuana in Colorado since it earlier news and topic discussions they have received many interesting stories of buyers traveling from there because of the price associated with legalizing it that they prefer to purchase in the black market at the cheaper price. According to Moffatt, M. (2014) the study estimates that the average price of 0.5 grams (a unit) of marijuana sold for $8.60
References: Baye, M. (2014). Managerial Economics. McGraw-Hill Irwin Moffatt, M. (2014). Should Governments Legalize and Tax Marijuana? Examining a Recent Study on Legalization. http://economics.about.com/od/incometaxestaxcuts/a/marijuana.htm Panne,V. (2014). The Weed Shortage. http://www.thedailybeast.com/articles/2014/01/11/high-time-to-head-to-colorado-native-pot-smokers-warn-of-shortages.html Poltonowicz, J. (2014). Marijuana Legalization May Spur America’s Next Great Industry. http://guardianlv.com/2014/03/marijuana-legalization-may-spur-americas-next-great-industry/