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Working Paper
Economic Benefits and Social Costs of Legalizing Recreational Marijuana
We analyze the effects of legalizing recreational marijuana on state economic and social outcomes (2000–20) using difference-in-differences estimation robust to staggered timing and heterogeneity of treatment. We find moderate economic gains accompanied by some social costs. Post-legalization, average state income grew by 3 percent, house prices by 6 percent, and population by 2 percent. However, substance use disorders, chronic homelessness, and arrests increased by 17, 35, and 13 percent, respectively. Although some of our estimates are noisy, our findings suggest that the economic ...
Legal Marijuana Poses Policy Questions for States
In recent years, more states have legalized marijuana for medical or recreational use. This raises economic questions for policymakers as they decide how to regulate cannabis.
Working Paper
Not in My Backyard? Not So Fast. The Effect of Marijuana Legalization on Neighborhood Crime
This paper studies the effects of marijuana legalization on neighborhood crime using unique geospatial data from Denver, Colorado. We construct a highly local panel data set that includes changes in the location of marijuana dispensaries and changes in neighborhood crime. To account for endogenous retail dispensary locations, we use a novel identification strategy that exploits exogenous changes in demand across different locations. The change in geographic demand arises from the increased importance of access to external markets caused by a change in state and local policy. The results imply ...
Working Paper
Immigrants' Legalization and Firms: Evidence from the 2007 EU Enlargement
How do firms respond to permanent changes in the legal status of a substantial group of migrants? We study the effects of the entry to the European Union of Bulgaria and Romania in the Italian labor market. This event was particularly relevant for Italy, where Romanians constitute approximately one fifth of the immigrant population. We use administrative employer-employee data on the universe of private-sector workers and an IV-DID design to identify the effects of this change in migrants' legal status on firms' personnel and performance. Firms exhibit an increase in the share of migrant ...