How will the legal cannabis industry affect the use and sale of alcohol, tobacco and medicines?
After legalizing cannabis in parts of the United States, Canada and Uruguay, the debate on legalizing cannabis is ongoing. Research showed that the legalization of both medical cannabis and recreational cannabis directly affects alcohol, tobacco and medicines consumption and sales. How do the cannabis, alcohol, tobacco and pharmaceutical industry react to this and how do they adjust their activities?
To look at this phenomenon, I relied mainly on (economic) scientific sources to see how these different products relate to each other. Based on this information, I looked at the annual reports, newsletter, etc. of various companies to see if they were adjusting their behaviour accordingly, and if the alcohol, tobacco and pharmaceutical industries were investing in each other.
The alcohol, tobacco and pharmaceutical industry had a connection with the cannabis industry, but each in a different way. Alcohol sales dropped by 15% in states where medicinal cannabis was legalized. This shows that alcohol en cannabis are substitutes. Cannabis and tobacco can have the same route of administration and smoking cannabis is seen as a predictor for later dependence on nicotine. Tobacco and cannabis are complementary goods. Cannabis was used on top of conventional treatments by patients, which had an impact on the use of medicines. Medicines and cannabis are complementary goods, but their relationship is more complicated.
It became clear that the legalisation of cannabis has an impact on the sale and consumption of alcohol, tobacco and medicines. During further research, it also became clear that the different industries try to take advantage of this to keep their sales as high as possible. They do this by introducing new products, but also by collaborations and investments in the cannabis industry. It can be argued that this is important for the development of further drug policies.