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Up in Smoke: the Effects of Recreational Marijuana Dispensaries on Regional Crime in Colorado and Washington, 2009-2014

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Up in Smoke: the Effects of Recreational Marijuana Dispensaries on Regional Crime in Colorado and Washington, 2009-2014 UP IN SMOKE: THE EFFECTS OF RECREATIONAL MARIJUANA DISPENSARIES ON REGIONAL CRIME IN COLORADO AND WASHINGTON, 2009-2014 _______________________________ A THESIS Presented to The Faculty of the Department of Economics anD Business The Colorado College In Partial Fulfillment of the Requirements of the Degree Bachelor of the Arts By Philip Cieplak February 2015 UP IN SMOKE: THE EFFECTS OF RECREATIONAL MARIJUANA DISPENSARIES ON REGIONAL CRIME IN COLORADO AND WASHINGTON, 2009-2014 Philip Cieplak February 2015 Economics Abstract This paper examines Whether the legalization of marijuana has contributeD to crime rates arounD ColoraDo anD Washington. Specifically, the primary objective of this paper is to analyze inciDent baseD crime rates in a 1,400-ft radius around each dispensary before and after legalization. I collected incident-baseD crime Data from cities across ColoraDo anD Washington from January 2009 to November 2014. For the control variables, I primarily useD census block groups arounD each Dispensary anD employment Data collecteD from the Bureau of Labor Statistics (BLS). After sorting each variable into sub-categories, I am able to test my hypothesis at Different levels across the Dataset. Aggregate Data analysis supports the hypothesis that legalizing recreational marijuana WoulD have no statistically significant effect on crime in ColoraDo anD Washington. Categorizing my results suggest crimes such as Burglary anD Robbery increased by up to 111%, While Vandalism anD ‘All Other Crimes’ DecreaseD by up to 130% since legalization. KEYWORDS: (Recreational Marijuana, Crime, Dispensary, Colorado, Washington) ON MY HONOR, I HAVE NEITHER GIVEN NOR RECEIVED UNAUTHORIZED AID ON THIS THESIS ________________________________________________ Contents I. INTRODUCTION AND MOTIVATION ............................................................................................ 1 II. LITERATURE REVIEW ..................................................................................................................... 5 INCIDENCE OF MARIJUANA CONSUMPTION ............................................................................................................. 5 DRIVING WHILE UNDER THE INFLUENCE OF MARIJUANA ................................................................................... 6 MARIJUANA’S EFFECTS ON THE BODY ...................................................................................................................... 7 MARIJUANA AS A GATEWAY DRUG ............................................................................................................................ 8 CAUSES OF CRIME ......................................................................................................................................................... 8 1) Retail Locations .................................................................................................................................................. 9 III. RELEVANT DATA: ......................................................................................................................... 10 CONTROLS: .................................................................................................................................................................. 12 IV. THEORY ............................................................................................................................................ 14 METHODOLOGY: ......................................................................................................................................................... 14 ECONOMETRIC EQUATION: ....................................................................................................................................... 15 V. RESULTS: ........................................................................................................................................... 17 HYPOTHESIS 1: ........................................................................................................................................................... 17 Table 5.1: Change in crime as a result of legalization .......................................................................... 18 Table 5.2: Change in crime as a result of legalization .......................................................................... 20 HYPOTHESIS 2: ........................................................................................................................................................... 21 SHORTCOMINGS: ......................................................................................................................................................... 21 VI. CONCLUSIONS: ............................................................................................................................... 23 VII. REFERENCES: ................................................................................................................................ 25 APPENDIX: ................................................................................................................................................ 27 Table 7.1: Crime Categorizations .................................................................................................................. 27 Figure 7.2: Violent and Non-Violent Crimes .............................................................................................. 28 Table 7.3: Violent and Non-Violent Crimes Table ................................................................................... 29 Table 7.4: Summary Table ................................................................................................................................ 30 Table 7.5: Crimes by Zone ................................................................................................................................. 31 Figure 7.6: Crimes by Year ................................................................................................................................ 32 ACKNOWLEDGEMENTS I would like to thank Dr. Kevin Rask for his Data analysis expertise. I thank Mr. Van Skilling for his Donation making the Data collection possible. I want to thank the crime analysis units of Bellingham, BoulDer, Denver, Fort Collins, Longview and Spokane for their support in data acquisition. I thank Madison Sink for her assistance using GIS. I would also like to thank Dr. Dan Johnson for not only balancing being Chair of the Economics Department, my Thesis Advisor anD my AcaDemic Advisor; but also for helping me become a life-long learner along the way. I. Introduction and Motivation Colorado and Washington voted to conduct stateWiDe social experiments: legalizing recreational marijuana, coming into effect in 2015. In November 2012, Colorado voters passed AmenDment 64 Which legalizeD marijuana for recreational purposes for anyone over 21. The amenDment alloWeD for commercial operations such as licenseD marijuana retail stores, manufacturing of eDibles anD mass cultivation operations; as Well as personal use including legally owning up six plants for personal consumption, gifting up to one ounce to another adult and possessing up to one ounce. Washington's Initiative 502 has essentially the same provisions. Under these new laws, marijuana WoulD be treateD similarly to alcohol in that marijuana cannot be consumeD in public and cannot be DistributeD without a permit. In adDition, individuals driving under the influence are subject to a DUI (FCGov 2012). Legalizing recreational use has the potential to generate significant tax revenues accruing primarily to public health care, substance-abuse clinics, and eDucation, and can create further taxation opportunities as a new profitable industry is created. As of the enD of 2014, ColoraDo anD Washington combineD tax revenue is about $75 million while the marijuana inDustry is projecteD to groW to become a $35 billion dollar industry by 2020 (Johnson 2015). Because of the risk entaileD with legalizeD marijuana, the industry is under heavy scrutiny. Workers in every grower and dispensary are under constant video surveillance While each plant is recorDed at each stage of the growth process. However even under these conditions, laWs under this amenDment can be hard to 1 enforce. There is no reliable THC Breathalyzer-equivalent on the market so it is difficult to track driving While under the influence. Also, there is no effective Way to enforce the rule limiting adults to up to six plants in their home, Which makes controlling the supply of legal marijuana Difficult. With this groWing supply in one state, trafficking marijuana across borDers Will become more anD more of a problem. Another issue With current legalization is that since marijuana Distribution is not nationally legal, banks cannot holD a Dispensary’s money. In response, each dispensary only accepts cash and every person visiting the dispensary must have cash in hand. (Parker 2014). Criminals are attracteD to cash transactions and dispensaries have responded by instituting heavy security. Marijuana consumption has alWays been a controversial issue primarily due to different perceptions of its cognitive and physiological effects. Even today, there are still Disagreements in the meDical WorlD over its effects on the body. Research has yet to shoW that recreational use of marijuana has harmful consequences but consistent, long-term use has ambiguous effects that the meDical field is just now discovering. Even so, to date no one has ever DieD from a
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