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The hemp is free


The future traffic light coalition has agreed on the legalization of cannabis for adults. In the guest article, Prof. Justus Haucap explains why the decision is correct, what a corresponding market should look like and which taxation makes sense.

The future traffic light coalition has agreed on the legalization of cannabis for adults.

In the guest article, Prof. Justus Haucap explains why the decision is correct, what a corresponding market should look like and which taxation makes sense.

Düsseldorf - "Give the hemp free", shouted Green politician Hans-Christian Ströbele in 2002 during the hemp parade in Berlin.

After 20 years, his demand will become a reality * - finally!

The call for an end to Prohibition has long been popular among economists.

50 years ago, the liberal economist and later Nobel laureate in economics, Milton Friedman, who otherwise had little in common with Ströbele, advocated the legalization of cannabis.

Voice of economists

Climate change, delivery bottlenecks, corona pandemic: seldom before has the interest in business been as great as it is now. This applies to the latest news, but also to very basic questions: How do the billions in Corona * aid and the debt brake fit together? What can we do about the climate crisis without jeopardizing our competitiveness? How do we secure our pension? And how do we generate the prosperity of tomorrow?

In our new Voice of Economists series, Germany’s leading economists are now providing guest articles with assessments, insights and study results on the most important topics in business - profound, competent and opinionated.

Many other prominent economists later joined the call.

The reason for calling for an end to Prohibition is not that economists only think about money and the state can raise taxes - that is more of a pleasant side effect of legalization.

The reason for the demand is not that economists consider cannabis to be somehow harmless.

Video: 4.7 billion euros: cannabis legalization could bring the state a lot of money

Cannabis: a rampant black market

On the contrary: precisely because cannabis is potentially addictive, but at the same time its cultivation can in fact hardly be controlled, the legalization of cannabis is necessary. The dilemma is that basically anyone can grow cannabis themselves, hemp grows almost like weeds. That the state can effectively enforce prohibition under these circumstances is an illusion for unworldly politicians. In fact, prohibition has created a rampant black market with increasingly potent cannabis products. Almost every third German has now consumed cannabis at some point in their life. Last year, more than eight percent of Germans between the ages of 18 and 59 consumed cannabis - and the trend is rising. This rate is even higher among younger people.

On the black market, cannabis is also provided with diluents, some of which are very harmful to health - youth and consumer protection are virtually non-existent.

On top of that, dealers have economic incentives to supply their “customers” with higher-margin hard drugs.

It is a good thing that the new federal government no longer wants to turn a blind eye to reality and wants to gain state control over the market.

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It doesn't work without shares

Anyone who wants to maintain the purchasing power of their assets in the long term needs real assets.

Unfortunately, savings accounts and fixed-term accounts do not help, writes Bert Flossbach, head of the well-known Cologne asset manager Flossbach von Storch, in a guest post. 

It doesn't work without shares

Traffic light coalition bears enormous responsibility

If Germany does not want to gamble away the future, public investment must increase sharply.

Not sometime, but now, writes the director of the union-related Institute for Macroeconomics and Business Cycle Research (IMK), Prof. Sebastian Dullien in the guest article.

Traffic light coalition bears enormous responsibility

The green boom and its enemies

Since the Corona crisis, many things are no longer the same - also in the economy, writes the chief economist of Allianz, Ludovic Subran in the guest article.

The green boom and its enemies

The relevant question is no longer


cannabis should be legalized, but


this should be done.

What should a market organization look like in order to guarantee real youth and consumer protection and to dry up the black market as quickly as possible?

Cannabis Legalization: Blueprint USA

Germany can learn from the 18 US states that have already legalized cannabis and from Canada, where Prohibition ended nationwide in 2018.

Many lessons can be learned from these experiences:

  • First

    , legalization should go hand in hand with comprehensive information and education about the health dangers of cannabis use.

    The impression should not be created that consumption is legalized because cannabis is harmless.

  • Second

    , the entire value chain from cultivation through processing to trading must be officially licensed. License violations must be punished and, if necessary, sanctioned with license revocation.

  • Thirdly

    , sales should take place on the one hand through licensed specialist shops. These shops should only sell cannabis products (and not beer and chips), they should not be allowed in by minors (similar to amusement arcades), and they must provide information about the health risks. On the other hand, pharmacies should also be allowed to sell. The latter is particularly relevant for areas in which running your own cannabis shops may not be profitable. As international experience shows, the less licensed sales outlets there are, the more difficult it is to dry up the black market.

  • Fourth

    , cannabis should be taxed.

    However, the tax must not be too high.

    A cannabis tax of 4 euros per gram would be a good start so that cannabis is not too cheap on the one hand, but not too expensive on the other.

    If cannabis is too expensive in the legal trade, it will not be possible to dry up the black market.

  • Fifth

    , there should be an upper limit for home growing.

    In Colorado, for example, six plants per person are allowed.

    Without a restriction, an unlicensed commercial offer can all too easily arise.

  • Sixth

    , the passing on of cannabis to minors should be made more criminal than before, in particular to curb the use of cannabis by teenagers, as some US states have succeeded in doing.

With such a market organization it should be possible to curb the negative consequences of cannabis consumption significantly.

About the author: Prof. Justus Haucap is director of the Düsseldorf Institute for Competition Economics (DICE) at the Heinrich Heine University in Düsseldorf.

From 2006 to 2014 he was also a member of the Federal Government's Monopolies Commission, including four years as chairman (2008-2012).

Haucap has been campaigning for cannabis legalization for years.

* is part of IPPEN.MEDIA

Source: merkur

All news articles on 2021-11-29

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