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Cannabis, alcohol and cigarettes: Substitutes or complements?

Publication Source

Cameron, L., Williams, J. 2001

Publication Title

Economic Record

Publication Type

Journal article

e-lib-feature-image

Metadata

Region

Western Pacific

Economy status

High-income economies

Tags High-income economies, Western Pacific, Journal article, Australia

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Abstract

This paper uses individual level data from the National Drug Strategy Household Surveys to estimate the price responsiveness of participation in cannabis, alcohol and cigarette use. In addition to own price effects, we estimate cross price effects and the impact of decriminalizing cannabis use. We find that participation is responsive to own prices. There is some evidence that cannabis is a substitute for alcohol and a complement to cigarettes, and that alcohol and cigarettes are complements. The liberalization of cannabis laws in South Australia may have led to a temporary increase in cannabis use among the over‐30 age group.