The Impact of the Legalization of Medical Marijuana in the Opioid Epidemic

Abstract

We study the effects of marijuana legalization on demand for opioids in the United states. We tackle this question using transaction level data on the purchases of opioids by all pharmacies across the US between 2006 and 2012, together with a difference-in-discontinuity research design across two pairs of states: Michigan and Indiana, and New Mexico and Texas. We show that, on average, the legalization of marijuana has lead to a reduction in the purchases of opioids. However, this negative effects is mainly driven by a reduction along the Michigan-Indiana border, while there has been an increase along the New Mexico-Texas border. This ambiguous effects, which mimics the contradictory evidence found in the literature, suggest the existence of important heterogeneous effects and the need for further investigating such differences.