NZ Initiative's Eric Crampton says California had a 22-year start on us in terms of using medical marijuana and it's time for cannabis reform here too

NZ Initiative's Eric Crampton says California had a 22-year start on us in terms of using medical marijuana and it's time for cannabis reform here too

By Eric Crampton*

There is a lot to be said for America’s federal structure. Fifty different states each trying different things not only lets policy better suit local preferences, but also helps researchers figure out the effects of different policies.

As New Zealand slowly starts considering that maybe, just maybe, marijuana prohibition has done far more harm than good, we can look to America for lessons about legalisation.

California legalised marijuana for medicinal use in 1996. Alaska, Oregon and Washington state followed suit in 1998. Today, medical marijuana is legal in 29 states plus Washington, DC. In New Zealand, Sativex, a marijuana-derived product, is available by prescription, but accessing non-pharmaceutical grade cannabis is not simple. American medical marijuana more typically means the ability to take a prescription to a registered dispensary and bring home your preferred strain.

Colorado and Washington state moved to allow legal recreational use of marijuana in 2012. Alaska, Oregon and Washington DC followed in 2014, and California, Maine, Massachusetts, Nevada and Vermont joined them in 2016.

In Washington, production, sale, possession and consumption of marijuana was legalised for adults over the age of 21 – the American minimum legal drinking age for alcohol. Today, the state imposes a 37% tax at the retail level – a high tax rate relative to other states that have legalised. Local jurisdictions in Washington receive some of the revenue from marijuana taxes, if they allow cannabis firms to enter the market. As we know from experience in New Zealand, local government can always choose to put in rules making it very difficult to open bars and bottleshops. Since they do not share in the revenue from alcohol excise, some councils’ hostility is easy to understand. Washington’s decision to share the excise tax revenue then makes a lot of sense.

Producers, processors and retailers are separately licensed, with a seed-to-sale product traceability system to prevent diversion into the black market. And researchers have even had access to the state’s database, which includes testing for potency.

Because medical marijuana and recreational marijuana rolled out slowly across American states, researchers have been able to do some rather interesting work looking at the effects of legalisation. Typical methods will compare states before- and after- legalisation, and compare that difference to what happened in other states that did not legalise.

Looking across the range of studies, the broad conclusion is that prohibitionists’ fears failed to materialise. There has been no increase in traffic accidents. There has been no increase in youth uptake of marijuana. There has been no increase in use of harder drugs – the usual ‘gateway’ hypothesis. Across the broad range of fears raised by prohibitionists, the most typical conclusion in the literature was that there really wasn’t any effect.

Let’s walk through the studies.

First up, traffic accidents. Driving while under the influence of marijuana is less risky than driving while drunk, but riskier than driving while sober. If legalisation meant that a lot of people flipped from driving sober to driving while stoned, then the accident rate could have increased. But if it meant instead that people shifted from driving while drunk to driving while stoned (or not driving at all while under the influence), the accident rate could have decreased. What happened?

Hansen, Miller and Weber tested the effects of legalisation on traffic accidents by looking at areas near the Washington-Oregon border. Washington legalised before Oregon, and so there was a lot of cross-border sales. When Oregon finally legalised, Washington retailers nearest the main north-south crossing-points saw sales decreases of about 58%. A lot of Washington product had flowed down into Oregon. The researchers used that to test the effects of marijuana legalisation on accident rates. Oregon counties far from the Washington border had less access to marijuana before Oregon legalised, while those close to the Washington border had ready access. And so, after Oregon legalised, you could compare accident rates in counties that had not previously had quite as easy of access with those that had had ready access prior to legalisation.

The researchers found no evidence consistent with legalisation increasing traffic accident rates. If anything, there might have been a decrease in accidents as people switched from alcohol to marijuana.

Driving while stoned is bad. But the Oregon evidence suggests that marijuana legalisation does not increase traffic accident rates. That conclusion mirrors the finding in prior work by Anderson, Hansen and Rees. Those researchers found an 8-11% drop in traffic fatalities, and a bigger drop in traffic fatalities involving alcohol, in the first year after a state legalises medical marijuana. This could either be due to people switching from alcohol to marijuana, or it could be due to people being more likely to use medicinal marijuana while at home since public use remained prohibited. Since the later work in Oregon suggested a drop in traffic accidents with legalisation of recreational use more broadly, it seems less likely that home-use restrictions on medicinal marijuana can take credit.

Next up, the children. Won’t somebody think about the children? It has never seemed plausible that prohibition particularly discourages youths from using marijuana. A dealer of illegal drugs will not care about his clients’ ages unless there are sufficiently higher penalties for selling to children than for selling to adults though licensed retailers care about keeping their licenses. But, again, it is an empirical question. Legalisation could normalise or de-stigmatise marijuana use and could consequently increase youth uptake. Did it happen?

No. Anderson, Hansen and Rees showed that medicinal marijuana laws, if anything, led to a slight decrease in youth uptake of marijuana. Sarvet et al’s later metastudy looked across eleven different studies of adolescent marijuana use and found no support for the idea that legal medicinal marijuana encourages youth uptake.

How about marijuana as a gateway drug – or as substitute for other drugs? Victoria University of Wellington’s Luke Chu showed that medical marijuana laws did increase overall marijuana consumption, but also resulted in a 20% drop in medical admissions for heroin-related treatment, with no effect on cocaine. By that measure, marijuana access reduced use of harder drugs.

And Powell et al’s recent study showed that medical marijuana laws reduced opioid mortality rates. Opioids have become a scourge in much of rural America, with abuse of Oxycontin being rampant. But access to medicinal marijuana dispensaries cut opioid overdose rates by about a quarter. And, in the earlier period when regulation around dispensaries was less tight, the reduction in opioid mortality rates was even higher.

How about liberalisation more broadly?

Angela Dills, Sietse Goffard and Jeff Miron look across the range of liberalisations to check effects on 132 different outcomes reported in surveys of high school students. Overall, they find no effect. Medical marijuana laws and legalisation improved 8 outcomes and worsened 9. Decriminalisation significantly improved 20 outcomes while worsening 4. When 132 different outcomes are tested across a range of different types of policy, a lot will wind up being statistically significant just by chance. The authors suggest that the ‘no effects’ finding is not particularly surprising where kids were hardly prevented from accessing marijuana by prohibition, and that further liberalisation is unlikely to have dramatic effects.

But the jury is still out on full legalisation of recreational marijuana use. Too few states have fully legalised for too short a period. Even in Washington State, where the 2012 election legalised recreational marijuana, access to legal product did not really start until 2014.

I think we can draw a couple of rather safe conclusions from America’s experiment.

First up, New Zealand could immediately adopt a much more liberal regime around prescriptions for marijuana. Medical marijuana has been around in America for a very long time now and does not seem to have resulted in any of the nightmare scenarios that prohibitionists warn against. The only thing that medical marijuana might be a gateway towards is full legalisation of recreational marijuana down the track.

On full recreational legalisation, it is harder to draw conclusions. It is harder to tell what the longer term effects on youth uptake might be, or on use overall. It has not been legal yet for long enough in enough states to really be able to tell. But it would be surprising if there were any large effects other than reducing the burden on police and on those who would otherwise be saddled with a criminal record.

We might listen to Washington state’s King County Sheriff’s Department, which put out a statement on the five-year anniversary of the vote to legalise recreational marijuana use. The statement read, “Drug use among teens over all is down. The retail marijuana shops do not cause significant amounts of increased crime. We aren’t arresting for misdemeanour marijuana anymore, which takes a huge burden off the criminal justice system.”

New Zealand likes to see itself as a leader in progressive social reform, or at least a fast follower. But America is leaving us in its dust, with Canada close behind them. It is remarkable that half of America, even under President Trump, is taking a far more liberal approach to drug law than we are in New Zealand.

America ran the experiment on medical marijuana, and California now has a 22-year head-start on us. It’s time for cannabis reform here too


*Eric Crampton is the chief economist at The New Zealand Initiative, which provides with a fortnightly column. 

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.


Pot liberalization led to a decrease in youth consumption huh. According in peer reviewed journal "Addiction" there has been a sharp increase in consumption in the USA since 2005.

Will the increase in tax revenue make up for the increase in life long welfare dependency caused by mental illness?

you are spreading misinformation - shame on you

I'm just quoting peer reviewed scientific journals. Here is a website highlighting the link between marijuana consumption and the early onset of Schizophrenia and other disorders. it also contains dozens of peer reviewed scientific journals as supporting information.

read them ALL again carefully - the ONLY scientifically agreed link is that those already very likely to develop psychosis related disorders MAY see the onset triggered by the use of marijuana

you dishonestly are asserting that marijuana leads to schizophrenia which is not true

those who will develop schizophrenia will do so with or without marijuana

and i haven't even begun to delve into what we have been learning about such disorders

if you are going to make yourself out to be an expert then first go get at least a first science degree in a related field

No – You are wrong. Schizophrenia pathology involves genetic risk factors and environmental stressors. If someone has generic risk factors it is not a foregone conclusion that they will develop the illness. Cannabis is definitely classified as an environmental stressor for that illness.

(edit) This is probably the most relevant paper, although it's a bit outdated now. Its a longitudinal cohort study of 953 New Zealand children until the age of 26. children who carried the COMT val158 allele and used cannabis before age 18 were more likely to exhibit psychotic symptoms or develop schizophreniform disorder.

I was an adolescent mental health specialist before moving to NZ. I've never met a single fellow professional in the field who would doubt the risk that regular and heavy cannabis use can pose to teenage and early adult mental health. We see it day in, day out. We see the families and lives destroyed by it. There is a specific condition named "Cannabis-induced psychosis".

Then there is the memory damage and premature senility associated with heavy, regular cannabis use (note *not* light use which is actually associated with improving symptoms in dementia).

I think it's wildly premature to give cannabis the all clear. For some people and conditions it can be helpful, for others it could be extremely dangerous.

Is it better to wait until a certain age to get into cannabis? Like 30+?

NZdan I really don't think there is sufficient evidence to say if there is an age where it becomes safer but I can give my personal opinion.

We do know that the human brain has much more plasticity and capacity for development before the mid-20's, so perhaps it is something connected to this that poses the additional risk? (NB. there is still brain development for some up to the early 30's).

My own personal observation as a clinician has been that the risk seems to be about the quantity/level of cannabis consumption. Heavy and regular use seems to be much more associated with a negative outcomes,
Although I have also known individuals who have a family history of schizophrenia, suffer a psychotic breakdown after brief or one off cannabis use (which fits more with the genetic predisposition triggered by cannabis hypothesis).

There are numerous forms and manifestations of psychosis. There are likely to be multiple causes and triggers, multiple genetics and epigenetics involved, varied tolerances and predispositions. Recent evidence shows a correlation between psychosis and inflammation for a percentage of people, which is new research. Who knows what else we will discover?

Unless there is a specific family history of mental illness I probably wouldn't be freaked about occasional/moderate cannabis use in teens and 20's. Making things taboo can cause other problems. There are social issues with cannabis legislation, so the whole issue is much more nuanced that just youth mental health but I don't think the issue should be dismissed either.

I will say that I have never known anyone who started young, sustained heavy usage and then not suffer some form of either mental health or neurological dysfunction. I know men in their early 30's, heavily using cannabis since their teens, who have severely impaired memory. Then there is the depression, the apathy, lack of motivation, dependency. It's not just psychosis.

IF you guys actually cared about the mental health of everyone you would be advocating for a full ban on alcohol since that is the number one cause of many health and social issues within New Zealand. Decades of propaganda making marijuana out to be evil has worked wonders to keep the war on drugs pumping along, filling the prison and justice systems. Both alcohol and sugar have a greater cost to our society than marijuana ever has or ever will.

This is about the freedom of adults to make the choice to indulge in something that does not cause harm to others if they use it. Yes people may become addicted and it may ruin their life or family but so does any addiction, there is always a small number of the population who indulge too much in anything, be it donuts or gambling, does that mean the other responsible adults must suffer? It would be much better for all if it was decriminlaised/legalised so these people felt safe to talk about their issue and seek help. The vast tax gains from selling the product could be utilised to improve rehab centers etc.

One only needs to look at countries such as Portugal to see how successful decriminalising drugs has been. Humans will always find a way to get the hands on and use drugs so why not tackle the issue from a different perspective? Our current way is clearly not working so its about time someone had the courage to try something new.

Always good to hear from Eric Crampton, His blog (Offsetting Behaviour) is a consistent go-to for me, as he is data-driven and not afraid to take on the shibboleths-du-jour.

Marijuana prohibition is a gift that keeps on giving to our local mafia - and with traceability mechanisms now widely used commercially, there's really no solid reason to hold out against some relaxation.

As gambling and prostitution are already legal here, organised crime in New Zealand has already suffered a big hit on their traditional money spinners. If cannabis is legalised they'll only have hard drugs, burglaries and protection rackets to make money.

FYI Drug mafia are still rampant in Netherlands. What will you lobby next? Legalise ecstasy, cocaine and meth?

heard of Portugal?

it's a country in Europe - that's a good start

Portugal's problem pre-decriminalisation was deaths from use of fake drugs obtained illegally. By decriminalising narcotics, they broke the business of cross-border counterfeit drug trafficking. The global media calls this a win because this move solved the problem of drug-induced deaths due to the chemical composition, not addiction or overdose. We did not have a fake drug problem in NZ the last time I looked.

Also, this article is about the benefits of legalisation, not decriminalisation. Not the same thing.

Simply reading 2 sentences about a country and its problems maybe a good start but never a solid conclusion. Public policy has no room for "one size fits all" solutions.

Outspoken UK drug expert David Nutt argues for regulated access to any drug less harmful than alcohol, including cannabis and Ecstasy.

He is a professor of neuropsychopharmacology at Imperial College London and author of Drugs: Without The Hot Air (2012).

Very interesting interview here.

Alcohol is a harmful drug, more so than cannabis.. to be fair it should be criminalised immediately.

Cant break the alcohol money train though!! Any logical reason for marijuana being illegal gets wiped out instantly if one compares it to alcohol, how convenient it never is though...

Everyone sipping on their wine, eating KFC, popping 2 painkillers and 2 antidepressants is very quick to judge this less harmful drug. Never heard of one death or medical issue from marijuana use, but those other 4? Hmmmm......

Isn't the real point re legalisation/decriminalisation that most anyone who wants to get hold of marijuana can already? They risk a criminal conviction but no enduring social stigma... a law change would simply catch up with reality. It's already widely available. At least with legal supplies you could be reasonably assured of the potency of what you were buying.

Your access to our unique content is free - always has been. But ad revenues are diving so we need your direct support.

Become a supporter

Thanks, I'm already a supporter.