High Crimes? The Effect of Marijuana Legalization on Crime in Colorado

Abstract

The previous decade has witnessed a surprising number of states move to legalize cannabis for both medical and recreational use. This movement has caused controversy regarding the uncertainty of the effect of legalization on criminal activity. While few empirical studies have shed light on recent legalization and crime, economic theory suggests that a reduction in prohibitions ought not to cause an increase in criminal activity. This study examines the effect of the legalization of recreational marijuana in Colorado on crime rates among all individuals as well as those 21 years of age and under using a synthetic control method to construct a counterfactual state of Colorado. The results indicate that crime increases in all categories in Colorado, with an especially significant increase in property crime committed by adults.

Keywords: Marijuana Legalization, Decriminalization, Drug Policy, Crime Rates

JEL Classification: H75, I18, K14, K32