Monday, November 13, 2017
The title of this post is the title of this intriguing new empirical article authored by Michele Baggio, Alberto Chong and Sungoh Kwon now available via SSRN. Here is the abstract (with the key finding emphasized):
We use data on purchases of alcoholic beverages in grocery, convenience, drug, or mass distribution stores in US counties for 2006-2015 to study the link between medical marijuana laws and alcohol consumption and focus on settling the debate between the substitutability or complementarity between marijuana and alcohol. To do this we exploit the differences in the timing of the of marijuana laws among states and find that these two substances are substitutes. Counties located in MML states reduced monthly alcohol sales by 15 percent. Our findings are robust to border counties analysis, a placebo effective dates for MMLs in the treated states, and falsification tests using sales of pens and pencils.