Estimating the Quasi-Underground: Oregon’s Informal Marijuana Economy

Authors

Seth S. Crawford, Oregon State University, School of Public Policy

Abstract

This study estimates the size of Oregon’s informal marijuana economy, drawing upon Respondent-Driven Sampling (RDS) procedures and survey methods to investigate this quasi-underground activity. The results suggest that average marijuana users consume approximately 4.5 ounces per year and pay approximately $177 per ounce. Most users purchase the drug from friends and nearly one third of respondents indicate that they sell marijuana in small quantities. Growers tend to sell inauspicious quantities to friends and relatives, and rarely earn more than $10,000 annually from their sales. The composition of distribution networks suggests that the informal marijuana economy is a “robust network,” particularly in states that allow personal medical production. This finding also suggests that legalization will likely produce a net increase in economic inequality, particularly affecting parts of Oregon associated with the State of Jefferson, by shutting out smaller producers. Several taxation schemes are presented to offer estimates of revenue if the drug were legalized; these findings suggest that marijuana could contribute modestly to the state’s total revenue, but the most economically beneficial aspect of legalization could be from criminal justice savings.

Recommended Citation

Crawford, Seth. 2022. "Estimating the Quasi-Underground: Oregon’s Informal Marijuana Economy." Humboldt Journal of Social Relations 1 (36): 118-137. DOI: https://doi.org/10.55671/0160-4341.1203