In November 2016, California approved a ballot initiative that legalized the recreational use of Marijuana for adults over the age of 21 years under the state law famously known as proposition 64. This state law paved the way for the limited cultivation and the legal sale of Marijuana for medicinal and recreation purposes within California. Although a majority of the people passed it, the law had brought a contentious debate about the future implication of the legislation. This debate had a great rift between the advocates and the critics, where the advocates held the view that: the legalization would cause a reduction in the crime rate since people would stop the illegal sale of the commodity, raise tax revenue as the legalization would cause a rise in the demand of Marijuana and improve the public health sector. Whereas the critics thought that the law would spike an increase in crime rates, harm the public sectors due to the availability of weed to consumers leading to addiction. Apart from these reasons, some key investors viewed Marijuana as a threat to the monopoly profit they enjoyed in the local market. This was because Marijuana was seen as a new substitute that would trigger competition, hence a deflation in pricing some commodities such as beer and other recreational substances (Pascula,2010). This paper discusses why the beer distributors opposed the legalization of Marijuana in California, whereas the snack food vendors supported it, and the facts that prompted the differences in their ideological views.
Being high or drunk was a choice that most consumers had to face after the legalization of Marijuana for recreational purposes. Hence, the beer distributors viewed the initiative as a threat to the local markets’ monopoly profit. Due to the substitution of alcoholic drinks by marijuana smoking, most beer investors feared that the sale and distribution of Marijuana could adversely impact the demand for beer. Additionally, the law prohibited the beer distributors from selling both Marijuana and other recreational substances within the same premises (Barry,2018). This brought a stiff competition between beer and Marijuana, bringing to an end the monopoly profit enjoyed by the beer distributors over the years since Marijuana served the same recreational purposes as beer. As a result, beer distributors opposed the legalization of Marijuana in California.
Snack food vendors supported the initiative since they thought there was a direct link between recreational Marijuana and increased consumption of high-calorie foods. Although there was no formal evidence supporting the effects of Marijuana on a person’s appetite, there was an increase in snack food purchases after the recreational marijuana legalization. However, the snacking sprout decreased slightly for ice cream and chips, but not for cookies. This effect brought a tremendous profit to the snack food vendors prompting them to support the legislation since Marijuana acted as a compliment instead of a substitute to their commodities (Pascual,2010).
When California legalized the recreational use of Marijuana, the beer distributors were opposed to it while snack food vendors supported it. Each group believed that the changes would affect their investment in one way or the other. The beer distributors thought the legislation would cause a decrease in profit due to the monopolistic practices of the enterprise. The monopoly profit deflated due to the substitutional use of Marijuana. On the other hand, snack food vendors were on the front line to support it because it would increase the consumption of snacks, thus increasing the enterprise’s profit.
Barry, R. A., & Glantz, S. A. (2016). A public health analysis of two proposed marijuana legalization initiatives for the 2016 California ballot: creating the new tobacco industry.
Pacula, R. L. (2010). Examining the impact of marijuana legalization on marijuana consumption: Insights from the economics literature. Santa Monica: RAND Corporation.