The Need for Change: An Economic Analysis of Marijuana Policy Note

The Controlled Substances Act was enacted in 1970. Since that time, billions of dollars have been spent enforcing marijuana prohibition and millions of individuals have been arrested. Despite these efforts, there has been little to no success in controlling the availability of marijuana. Federal and state efforts to reduce marijuana production and use through prohibition have been ineffective, and those efforts have been far less than equitably applied across economic and racial divisions. Given the costs associated with prohibition and the meager results obtained thus far, it is time to rethink the national policy of prohibition and consider abandoning the nearly forty-year-old model. Thirteen states have decriminalized possession of small amounts of marijuana for personal use, and many more states have greatly reduced the penalties for possession. Decriminalization carries with it many of the same societal costs associated with total prohibition and does nothing to dismantle illegal trafficking operations. Legalization, on the other hand, would eliminate the criminal supply network and would also remove the direct and collateral sanctions that currently fall so harshly upon minority and low-income marijuana users. This Note explores legalization of marijuana within a system of regulation and taxation. It compares the efficiency, fairness, and political and administrative feasibility of a policy of legalization to both federal prohibition and state-level decriminalization. The purpose of this Note is not to conclusively determine that legalization is the best policy, but to demonstrate that it is a viable alternative deserving of serious consideration in any marijuana policy debate