re: Colorado passes $1 billion in marijuana state revenue

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We call this substitution effect in economics

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What do you guys in economics call it when Funion sales go up 400% as a direct result of marijuana legalization?

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Again, this is misleading.

People are buying marijuana, but they are doing so by switching their spending habits to mj from other products.

Every dollar spent on mj is a dollar not spent elsewhere, so the billion dollars in revenue doesn’t represent an actual gain in a billion dollars for the state, it just means the state lost a billion dollars in sales tax revenue in other industries which is now being spent in mj shops.

We call this substitution effect in economics

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This, ladies and gentlemen, is called "trying to sound smart."

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Well, also, a huge reason they're generating this kind of money is because it's illegal in a ton of other states

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True.


Of all the reasons pot should be legal, the idea that the state will get more tax revenue is the weakest argument for me. I don't want them to have more money to waste.

I’m simply relaying what ca and co’s own state governments have found

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Or hate paying $400/oz.

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I'd be really surprised if it averages anywhere near that in CO.

I buy mids for $150/oz in Texas

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I buy mids for $150/oz in Texas

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I bought an oz of mids for $40 a few months ago from a legal store.

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I’m simply relaying what ca and co’s own state governments have found

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So the whole "We call this substitution effect in economics" really means I read some government studies I didn't understand but used a term of art because it sounded good not because I knew what it meant. We call this bullshite effect in tOT.

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We call this bullshite effect in tOT.

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Yes, i wrongly used a term that refers to changes in quantity demanded due to price changes and people switching to cheaper alternatives.

But I still think mj can be thought of as a “substitute good”, which literally means a good that can be used in place of another. Mj is technically just a substance we consume to fulfill a bodily want.