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Effects of Cannabis Legalization on Tobacco and Alcohol Prevalence

Gregory Chung

Pareto Undergraduate Journal of New Economists

Vol. 1 No. 2, Issue 2023

pp. 3 - pp. 18


This paper investigates the potential links between cannabis legalization and the use of other substances in the United States. In particular, it tests for changes in the prevalence of tobacco and alcohol use following cannabis legalization (Medical or recreational). This study is carried out on all 50 American states using a difference-in-differences estimator with data running from 2012 to 2018. It finds a significant decrease in tobacco use as a result of cannabis legalization. However, no statistically significant change in trend is observed in the prevalence of alcohol use following cannabis legalization.

Gregory graduated from the University of Toronto Mississauga in 2020 with an Honours Bachelor of Science specializing in Financial Economics. Post-graduation, he worked at the Bank of Canada in the Canadian Economic Analysis department and is now working in the Financial Markets department. His work focuses on the formation of household expectations of inflation and macroeconomic modeling more generally. He will be completing a Masters in Economics in the near future and is interested in central banking and monetary policy. Outside of work, he is passionate about music and playing guitar. Greg’s paper “Effects of Cannabis Legalization on Tobacco and Alcohol Prevalence” was submitted to satisfy the final requirement of his final year dissertation course (ECO420). He would like to thank Professor Zammit for coordinating and providing invaluable support throughout the research course (ECO420) and beyond.


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