MEDICAL MARIJUANA LAWS AND CRIME: An Empirical Analysis of Market Design and Racial Implications

Abstract

Beginning with California in 1996, 23 states and Washington, D.C. passed medical marijuana laws (MMLs) that enable eligible patients to obtain and consume marijuana. MMLs generally allow patients to cultivate marijuana in their homes (home cultivation laws), purchase marijuana from state-licensed dispensaries (dispensary laws), or do either. The sale and distribution of marijuana is still illegal at the federal level, and opponents of MMLs argue that these laws will increase criminal behavior and perpetuate racial disparities in drug-related arrests. I implement a differences-in-differences approach to quantify the effects of each type of MML on arrest rates for property and violent crime. I find that MMLs are associated with an 8.2% increase in combined property and violent crime arrests. Dispensary laws account for a 16.0% increase in arrests, which is driven by estimated 22.7% and 19.4% increases in burglary and robbery arrest rates. Home cultivation laws are not found to have a significant relationship with arrest rates. The white population drives the overall results; for either type of MML, I find no significant effect on arrest rates for the black population. My results indicate that the association between MMLs and crime is dependent on market design, and that neither type of MML leads to disproportionate arrests among the black population.