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From a policy standpoint, the legalization of marijuana may affect other drug markets. The Almost Ideal Demand Model is used to estimate drug substitution between the most common illegal street drugs in the US including cocaine, heroin, marijuana, and methamphetamines. We control for past marijuana consumption. Results indicate that past marijuana consumption does not contribute to increased current consumption of other drugs. Further, marijuana is a weak complement to methamphetamines but marijuana price changes do not affect heroin or cocaine consumption.

Does Previous Marijuana Use Increase the Use of Other Drugs: An Almost Ideal Demand System Approach