The Regulatabilization of Cannabis
- Author(s):
- Donald J. Kochan
- Posted:
- 3-2022
- Law & Economics #:
- 22-10
- Availability:
- Full text (most recent) on SSRN
ABSTRACT:
With the change in legal status, marijuana is not really being legalized or even just decriminalized. It is being made regulatable or, to coin a phrase, regulatabilized. Markets in illegal goods - along with the goods' creation, cultivation, distribution, taxation, sale, etc. - are controlled by criminal law but not regulated per se. Indeed, they are not regulatable because to do so would acknowledge the legitimacy of the activity. Remove illicitness, and suddenly regulatability brings with it layers upon layers of compliance obligations. From an economics perspective, the regulatabilization framing is key because it puts front and center that we are not looking at the functional dynamics between an illicit market and one that simply removes illicitness.
Urban planners and other policymakers cannot pretend or believe that simply making an industry like cannabis legal will automatically make all cannabis activity law-abiding in nature, especially if the costs of operating within the legal market are higher than the illicit alternative. This is all the more reason that an imprecise frame risks obscuring the real costs and market limitations of an effective legalization or decriminalization strategy. Understanding these facts and drawing attention to them with a regulatabilization frame will allow the discussion to more realistically evaluate whether the legal move of opening the door to legal markets in marijuana can accomplish its goals. This Article introduces a greater level of realistic expectations of the regulatory landscape after changing the legal status of marijuana and industries related to it, as well as contributing a level of nuance and sophisticated understanding of what it means to change that status.