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“No drugs in my back yard:” The ambivalent reception of cannabis retailers

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  • Bruijn, L. Michelle
  • Ribas, Rafael P.

Abstract

Can individuals’ aversion to drug markets curb the benefits of decriminalization? We investigate the effect of two policies on housing demand in the Netherlands: the distance-to-school criterion, which closed some cannabis shops in a few cities; and the zero-tolerance policy, which banned shops within municipal jurisdictions. While a small increase in the distance to retailers raised house prices by 1–5%, a substantial increase reduced them by 1–6%. Both policies reduced property crime, but the zero-tolerance was also related to fewer jobs. Our findings reveal that cities benefit from having cannabis shops, but households’ aversion to related nuisances depreciates surrounding areas.

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  • Bruijn, L. Michelle & Ribas, Rafael P., 2022. "“No drugs in my back yard:” The ambivalent reception of cannabis retailers," Journal of Economic Behavior & Organization, Elsevier, vol. 199(C), pages 103-121.
    • Handle: RePEc:eee:jeborg:v:199:y:2022:i:c:p:103-121
    DOI: 10.1016/j.jebo.2022.05.005
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    More about this item

    Keywords

    Drug policy; Cannabis sales; Disamenity; Housing demand; Job creation; Crime;
    All these keywords.

    JEL classification:

    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand

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