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The US Map of Prices of Pot

UPDATE: just got the question on Twitter: “what does this have to do with development?” Answer: nothing, except that you will never understand development if you are so quick to ask that question.

When I first saw this map, I immediately thought legalize pot! what a great teaching tool for my Intro students! So students, please explain using the concepts of supply, demand, and transport costs (including in this case smuggling costs) the pattern of prices you see here.

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10 Comments

  1. marc wrote:

    Sorry, but this map is apparently useless. If you look at the individual entries, it’s apparent that some ass-wipes are going in and adding amounts that are ridiculous, e.g., $1000 for low quality 5g. or $20 for high quality 5g, etc. And I am sure that some are just adding reasonable bogus entries that don’t reflect reality.

    Nice concept though! As with everything in this country, the anti-intellectual animals that dominate are out in force screwing things up, preventing any reasonable evaluation or discussion about anything.

    Posted December 4, 2010 at 10:34 am | Permalink
  2. David Zetland wrote:

    @marc — even with bad data, the truth will out with the law of large numbers. Same as for wikis… (Median averages would take care of that problem too :)

    Posted December 4, 2010 at 3:55 pm | Permalink
  3. Jacob wrote:

    OK, here goes:

    The states from Cali up to Canada (labelled “Stoners” on the following map http://i.imgur.com/EA4fk.png) reputedly grow a lot of pot, so they have some of lowest prices. They also have pretty lenient pot laws, which also cuts down on their prices.

    The east coast and the middle of the country have high land transport costs, but I don’t think that that’s the biggest component of their higher prices. A bigger factor is, I think, the risk premium that smugglers have to charge to get the pot there. The more states you have to drive/fly over to sell pot, the more risky your operation, and the more you’ll need to be paid. Laws also tend to be more strict in the middle of the country, hence the high prices there.

    Prices are lower along the Canadian border than the Mexican border, probably because the Canadian border is less heavily defended (again, with the exception of the middle of the country).

    In general, states with medical marijuana laws have lower prices, for obvious reasons–a legal segment of the market makes for lower prices. Some notable examples are Cali, Oregon, Washington, Colorado, Nevada, Montana, Michigan, and Maine.

    Posted December 4, 2010 at 6:27 pm | Permalink
  4. Dan Kyba wrote:

    @jacob

    BC (Canada) agriculture is dominated by the marijuana sector; because of the multiplier effect that illegal industry has on the BC economy, there was some serious coverage in the business media about the potential economic impact should the recent California plebiscite have passed.

    Posted December 4, 2010 at 10:19 pm | Permalink
  5. BPeterson wrote:

    @Jacob:

    That doesn’t explain the low prices in the mountain West (Utah, Idaho, Wyoming and Colorado)…..but I think that is explained by high levels of local supply. People are usually surprised to find out how much marijuana is grown in Utah, thanks to large tracts of public land that are quite remote.

    Posted December 5, 2010 at 4:16 am | Permalink
  6. Nelson Villoria wrote:

    “what does this have to do with development?” I guess that a lot. A former mexican prime minister said something like in the war against drugs, the US puts the money and the weapons and Mexico the drugs and the dead. This applies for pretty much any state in Latin America with a strong narco sector. However, when you read about US policy towards LATAM, the focus is on things such as illegal inmigration, free trade, IP and the like —- or war actions such as Plan Colombia. It’s good to see you care about this, BillI. It’d be nice to read your thoughts on the issue of drugs, development, and the responsibility of rich vs. developing countries.

    Posted December 5, 2010 at 10:46 am | Permalink
  7. William Easterly wrote:

    Jacob and BPeterson, thanks for doing the analysis, it sounds right. I would guess that the low prices in the Mountain West also have to do with low demand, but that’s just a guess.

    On the “what to do with development?” issue, I am fiercely opposed to having a requirement that every post have a moral: “and the development lesson is…”

    Amongtst other reasons I would prefer the readers draw their own lessons, and not everything has to be a “lesson.”
    Bill

    Posted December 5, 2010 at 1:55 pm | Permalink
  8. Word Choice wrote:

    @David, “you will never understand development if you are so quick to ask that question” — really?! come on. you don’t have to be that smug.

    Posted December 5, 2010 at 1:58 pm | Permalink
  9. Karis wrote:

    @Nelson

    I think drug trade thru Mexico has more to do with Cocaine than pot…

    @bill easterley fair enough. Just please stop responding to every no lifer who has to berate on such posts – all the tweets get annoying, and I would like to keep following to get the interesting tweets. Just tell them to get a life and move on!

    Posted December 5, 2010 at 2:16 pm | Permalink
  10. Aaron wrote:
    Posted December 7, 2010 at 1:59 am | Permalink

3 Trackbacks

  1. […] This post was mentioned on Twitter by William Easterly, Derek Barry, Tobias Blanken, Anthropology Works, Scott Gilmore and others. Scott Gilmore said: How expensive is pot in the US? Well, how close is your state to BC or Quebec? http://bit.ly/dK4heX (HT @bill_easterly) […]

  2. By Maps » Blog Archive » The US Map of Prices of Pot on December 4, 2010 at 10:56 am

    […] post: The US Map of Prices of Pot Tags: a-great-teaching, and-transport, case, concepts, first-saw, great-teaching, intro, […]

  3. By The Economics of Pot « The Unqualified Economist on December 7, 2010 at 10:38 am

    […] Bill Easterly takes this map of pot prices…. […]

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