From the Black Market to Legalisation: The Causal Impact of Cannabis Reform in Morocco

This article analyses the impact of legalising cannabis production for industrial and pharmaceutical use in Morocco, paying particular attention to reducing illegal cultivation. Using an original dataset compiled from multiple sources and employing an advanced econometric approach based on the Synthetic Control Method, the study provides robust evidence of a substantial decrease in illegal production as a consequence of the reform. The results have two main implications. First, for Morocco, regulated legalisation emerges as an effective policy tool for reducing the informal economy, with positive effects on tax revenues and international trade. For Europe, and Italy in particular, the reform introduced in the North African country creates new opportunities for the supply of medical cannabis, providing an alternative or supplementary source that could help to alleviate the ongoing shortage of cannabis intended for medical use.