High-Potency Pot Would Dominate a Legal Marijuana Market

With marijuana, as with so many other things, where one sits influences where one stands. Relative to the U.S. population as a whole, people who write about public policy regarding marijuana (e.g., college professors, newspaper editors, drug policy analysts, Internet users and drug legalization activists) are disproportionately college educated and middle to upper-middle class. They therefore are prone to assume that the type of marijuana — specifically potent sinsemilla (THC content 10-18%) — that is popular with better-heeled users is more commonly consumed than it is.

As Caulkins, Hawken, Kilmer and Kleiman’s book Marijuana Legalization: What Everyone Needs to Know makes clear, sinsemilla is in fact a small part of the marijuana market. About eighty percent of the market is “commercial grade” cannabis, which has a THC content of about 5% and sells for $70 to $230 per ounce, depending on how far a buyer is from the producing farm and in what amount he or she buys. If that level of potency and price surprises you, you are probably an observer or participant in the small, nationally unrepresentative marijuana “upmarket“.

The reason for the current dominance of commercial grade pot is simple: It’s an inexpensive product for a price-sensitive population. In the late 1960s and 1970s, the marijuana market had an upmarket skew, but no longer. Today, Caulkins and colleagues estimate that college-educated people only account for about a 1/7 of all marijuana smoked in the U.S., and they overwhelming smoke sinsemilla. The vast bulk of marijuana consumption in the U.S. today is accounted for by working class and poor people who are heavy users. If you make $75,000 a year and smoke pot once a month, springing for high-potency sinsimilla is easy. But if you make $18,000 a year and smoke several joints every day, commercial grade pot is all you can afford.

However, as Caulkins et al. show, the only reason marijuana is expensive is because it is illegal: After all, it’s just a plant. Indeed they project that the post-legalization cost of sinsemella joints would be so low that businesses could give them away, much as bars now give away peanuts.

There may be a few consumers who are so price sensitive that they would still prefer commercial grade pot at say, 3 cents a joint versus 5 cents for sinsemilla. There may also be a few odd micromarkets in which people preferred the weaker stuff as “more authentic” (Those of us who grew up near Latrobe, Pennsylvania are agog when upscale hipsters who could afford something better drink Rolling Rock beer as a sign of their solidarity with us). But as a general proposition, it is safe to assume that the commercial grade market would shrink dramatically, making sinsemilla the dominant component of the marijuana market.

What difference would this make? For the heavy-using low income user, it would free up some disposable income which — presuming it were not spent on alcohol, tobacco or other drugs — could improve their economic situation and health. On the other hand, those of such users who are parents would be displeased that their children could now easily afford high-potency marijuana, which even in secondary black market sales would be extremely cheap.

Another important consequence: The cannabis-using population would experience a vast increase in average drug potency. Caulkins and colleagues estimate that in the past 15 years, average potency of marijuana in the U.S. has doubled. But after legalization, with the 80% commercial grade market share being almost completely supplanted by sinsemilla, average potency would roughly triple very rapidly.

This increase in exposure to highly potent cannabis is one of the mechanisms through which legalization would result in a higher prevalence of addiction (Some of the other mechanisms are discussed here). It at first seems reasonable to assume that experienced users would simply titrate their dose of higher-potency pot, making higher or lower doses equivalent from a biological viewpoint. But surprisingly, laboratory studies of experienced marijuana users show that they are in fact poor at judging the potency of cannabis.

Just as important, even if users could titrate their use (e.g., inhale for a shorter length of time) to achieve the same dose in the body, higher potency products would still be more addictive. With pharmacologic reinforcement processes, the speed of an attained effect is as important as the effect itself. Thus, two regular users who become comparably intoxicated at two different speeds have differing likelihoods of becoming addicted. The replacement of the commercial grade-dominated market with a sinsemilla-dominated market would result in more users speeding up the achievement of intoxication and thereby increasing their likelihood of becoming addicted to cannabis.

Would the dominance of sinsemilla be the end of a market-wide rise in potency? Maybe, maybe not. There are other ways to process cannabis that push THC content more than twice as high as that of sinsemilla. Currently these production processes are extremely costly, but they would become much cheaper under legalization, perhaps to the point that such products would be broadly affordable. Theoretically, this could be stopped by potency limits within the regulatory framework, but in reality, none of the three current state-level marijuana legalization initiatives include any controls on drug potency.

Author: Keith Humphreys


17 thoughts on “High-Potency Pot Would Dominate a Legal Marijuana Market”

  1. Really? Our local high school provides an interesting laboratory in that it mixes suburban kids with transfer students from a failed inner city district. Many of the former have money (in some cases, lots of money) and some of the latter have access to brothers, cousins, neighbors with drugs for sale (in some cases, lots of drugs). As far as I was able to tell through my children’s 9-year trajectory through that school the percentage of drug experimenters, regular drug users, drug abusers, and self-destructers was exactly the same as it was in the city high schools of my youth (1970s). And in fact, essentially the same percentages as adults who enjoy, use, or abuse alcohol and other “graduate” drugs.

    Human beings like to consume moderate mind-altering substances; always have. Some percentage of humans will abuse, a sad but small percentage will self-destruct. I’m terribly unconvinced by the arguments of those who would take Elvis Presley’s place next to Richard Nixon in the famous photo that relaxing the brutal war on some drug and incarceration of some elements of the population will immediately result in an entire generation of Cheech & Chongs.



    I realize that anecdotes are not data, but then again, neither is inflated conjecture presented as fact, so here goes:

    I traveled to CA back in the ’80’s for a wedding and brought some midwest commercial-grade pot along. Everyone there was smoking sinsemilla, and you couldn’t even find commercial grade locally. Relatives were eager to swap me straight-up (even though theirs cost more than twice as much) because it was something different than what they could get, and it had a different flavor and high. They would say “ooohh that tastes good! We haven’t seen brown weed around here for years!” Variety is the spice of life, ya know. I wasn’t as eager to trade because I also preferred the flavor of the brown weed. Nowadays sinsemilla is dominant in the midwest, the brown “Columbian”-style pot is all but non-existent, and the cheap dark green Mexican brick is almost all trash — full of stems and crushed seeds, often moldy, and occasionally reeking of diesel fuel. I haven’t had access to testing facilities, so I can’t tell you any facts about relative THC content, but I’d sure like to get my hands on some Gold Bud like that which was common in the ’70’s — that stuff tasted GREAT and had a wonderful buzz. To the aficionado, it’s not so much about the THC content per se. Flavor and “buzz” are prominent factors. Personally, I find high-potency medical-grade pot a bit too powerful for my tastes (and too expensive). A good buzz is nice, but I really don’t care to get cemented to the couch for the rest of the evening, drooling potato chip crumbs all over myself. Similarly, I prefer a tasty craft beer to a shot of Everclear.

    But 5-cent joints? What have you been smoking? Checked out the prices of (quasi-)legal marijuana in MM states lately? Have you noticed how re-legalization proposals all seem to have a significant tax component to them? Where can I buy a 5-cent cigarette? After all, itâ€™s just a plant.

    However, as Caulkins et al. show, the only reason marijuana is expensive is because it is illegal … Another important consequence: The cannabis-using population would experience a vast increase in average drug potency [under re-legalization].

    I find it a bit odd to acknowledge that prohibition forms a price-support structure around marijuana while ignoring how prohibition also tends to incentivize toward higher potency. The average potency of alcohol products didn’t go up after re-legalization, it went down. Why would that be? Because there are very few people who actually prefer moonshine to, say, a glass of wine. A free market will provide whatever is in demand, and once it no longer needed to be “bootlegged”, the market was able to do that with alcohol. If this were 100 years ago, your headline might read “high-potency booze would dominate a legal alcohol market”, and it would have just as much basis in factual analysis of the prohibition-era trends toward higher-potency alcohol, but it would still turn out to be wrong.


    Yes, just like the rise of Starbucks and popularity of espresso have replaced the commercial-grade coffees in the market and caused the caffeine addiction scourge now devastating the country. Wut?

    1. The idea that high potency will dominate also relies on the implicit assumption that working-class smokers are unwilling/unable to regulate their consumption. Since the vast majority hold jobs for which complete intoxication would unfit them, that seems unlikely to me. They’ll regulate for the same reason that workers who depend on alcohol have a couple of beer instead of a couple glasses of cheap whiskey with lunch.

      On the other hand, there will be some smokers for whom the cheap availability of potent weed leads to uncontrolled addiction, just because bell curves work that way. But probably easier to deal with those in a regime where major jail sentences aren’t part of the risk of getting help.

  3. Allegedly, the sage medieval scholars consulted Aristotle to learn how many teeth a horse has, while the naive boy went out to the stable and counted them.

    This theoretical exercise projects what would happen if marijuana were freely available. How accurate is it? Well, there are places in the developed world (e.g., the Netherlands) where marijuana is pretty freely available. If Prof. Humphreys’ theoretical analysis were valid, it should explain the Dutch experience. But the Dutch don’t seem burdened with an epidemic of addiction to sensimilla.

    Perhaps we should check what Aristotle had to say about addiction rates?

  4. I used to kind of like Rolling Rock, although I was in grad school and cheapness was a factor (as well as Western Pennsylvania pride). It always seemed like generic beer to me — not dark beer, not light beer, not good beer, not bad beer, just beer. But anyone who tries to drink it in solidarity with Latrobe now is sadly misguided, since Anheuser Busch moved it to Newark. When Obama visited Latrobe in 2008, his advance team did its homework — he had a Yuengling.

    The really terrible local beer was always Iron City.

  5. Alcohol taxes tend to be related to potency. Alcoholics will still go for the high-strength stuff, but for social drinkers taxes seem to level the playing field quite well. Spirits haven’t driven out beer and wine. In Russia SFIK the post-1991 arrival of drinkable beer even displaced vodka to some extent.

    1. Some alcoholics go for high strength LOW COST, others for high strength, regardless of cost. Do we have a breakdown by socio-economic status?

    2. If you attend any A.A. meeting you will find the majority were beer drinkers. You will be hard pressed to find a drunk that preferred 190 proof grain or 151 proof rum if you attend every A.A. meeting in your locality.

  6. Of course MJ users would (and do) titrate their use based on potency. Booze users do – shot glasses are smaller than wine glasses, which are smaller than beer glasses.
    It’s easy to do.
    Joints are not all the same size. Smoking in a pipe or vaporizer allows very customized doses.

  7. We do have actual experience with legal tobacco and alcohol. You could make directly analogous arguments about what could happen in those markets; and yet these things don’t seem to have occurred. Cigarettes aren’t available for pennies apiece. There are distinct markets for beer, wine, and liquor. Alcohol could also be, in principle, very cheap; and yet there are minimum costs that seem to be well supported. It’s entirely possible for social pressure to cause declining usage of a legal substance (tobacco.)

    I just don’t find the line of reasoning in posts like this remotely convincing. It’s also hard to avoid the conclusion that all of the arguments that I see here against legal marijuana could be made equally well against legal tobacco or alcohol. Given that alcohol prohibition was a disaster, doesn’t this give the authors here any pause whatsoever about the excellence of their position?

  8. Don’t knock the Rock! Before microbreweries sprouted on every corner, getting hold of Rolling Rock, Gennessee or quality local beers was often the best a beer lover could do.

  9. I wonder, Keith, how recent are your data showing the dominance of “schwag” (seeded, compressed cannabis) in the American market? One thing seems evident: the US cannabis market is in transition, and the medical cannabis movement has a lot to do with it.

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