Economics of Illicit Drugs

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rinalh

Economics

ECON

Brock University

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Economics of Illicit Drugs

Assignment

Due: Wednesday, December 4 in Prof. Koehn’s assignment box located outside Department of Economics.

Your assignment is to analyze the assignment article using the economic concepts and theories covered in ECON 2P34.

You may use any style you prefer, such as MLA, APA, etc. You can use other resources in your answer, but they must be cited properly. Your assignment should be 1000 words.

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Running head: ECONOMICS OF ILLICIT DRUGS

Economics of Illicit Drugs
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1

ECONOMICS OF ILLICIT DRUGS
Economics of Illicit Drugs
Cannabis was legalized approximately a year ago in Canada. Therefore, based on the
economics of illicit drugs, it is necessary to have a reflection on the whole concept of cannabis
regulation. According to Bear (2019), one of the most significant changes in the social policy of
Canada was the legalization of cannabis in the country. Remarkably, one of the critical concepts
learned in ECON 2P34 is the legalization of illicit drugs. The legalization of marijuana has not
yet led to the intended effect on social justice, especially for individuals who had been convicted
in the past for drug offenses that are currently legal.
It is important to note that the demand for cannabis in Canada is still high. This has
resulted in the illicit cannabis market continuing to thrive due to regular consumers who tend to
be more price-sensitive. The legal cannabis is sold at a higher price than the marijuana sold by
illicit suppliers. The difference in price stands at 4.72 US Dollars per gram. This means that an
individual who consumes cannabis daily will prefer to continue purchasing from an illicit
supplier and save 132 US Dollars per month (Bear, 2019). However, for consumers who are not
price-sensitive, they will prefer buying from legal cannabis suppliers. This situation in Canada is
an excellent illustration of the concept of price discrimination in comparison to the legal drug
market. Furthermore, legalization of illicit drugs can affect the demand for such drugs. Also, the
legislation of cannabis in Canada has made its market structure to be clear and distinct. In the
market, there are consumers who are price-sensitive and those who are not concerned much...

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