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The millennial generation is split in 2: an older crowd with boomer-style comfort, a younger set going 'back to the early 1900s'

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Why alcohol companies should warm up to cannabis

By
Chris Matthews
Chris Matthews
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By
Chris Matthews
Chris Matthews
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May 15, 2014, 12:24 PM ET
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FORTUNE — According to recent polls, a majority of Americans now support legal, recreational pot use. But not everyone’s on board. Count big alcohol companies among the naysayers.

Though booze purveyors are not universally opposed to legalization, alcohol distributors were one of the main forces fighting California’s 2010 push to legalize recreational cannabis use. And the beer, wine, and liquor industry has donated tens of thousands of dollars to vocal opponents of pot proliferation in Congress, like Rep. Lamar Smith (R-Texas).

The logic behind this opposition is pretty simple: if pot is more widely available, then consumers might choose it as a substitute for alcohol.

MORE: Can you get fired for smoking medical marijuana?

But according to a study published Wednesday by the National Bureau of Economic Research, it appears that in places where medical marijuana became legal in recent years, alcohol consumption has actually increased. Emory University-based researchers used data from the National Survey on Drug Use and Health from 2004 to 2011, looking at states that implemented some form of medical marijuana legalization over those years.

Legalization of medical marijuana increased the probability of marijuana use among adults over 21 by just over 1%, and the researchers wrote that there’s reason to believe that some of this use is coming from recreational users as well as patients. These states also saw a slight increase in the use of marijuana by young adults aged 12-20, but the frequency of cannabis use among this group is pretty low, leading researchers to conclude that:

“these findings are consistent with a scenario in which adolescents and young adults who experiment with marijuana use because of the potentially increased availability and social acceptance and reduced penalties brought about by an MML are not transitioning to regular use, at least in the short term.”

The more surprising finding was that the availability of medical marijuana increased the number of days in which adults over 21 binge drank (defined as having more than four drinks per day) by 6-9%. It did not, however, have any effect on underage drinking.

In economic jargon, it appears that for some folks marijuana is a “complementary” rather than “substitute” good relative to alcohol, especially when alcohol is consumed in larger quantities. For alcohol companies, this is good news. It appears that the liberalization of marijuana laws isn’t related to a decrease in drinking but, in fact, may be leading some to drink more.

MORE: After 8 years, the real estate market is finally looking normal again

From a public health perspective, however, these results are potentially troubling. As the writers of the report concluded, “The complementarity between marijuana use and binge drinking among adults of legal drinking age could magnify the expected harm of [medical marijuana].”

Supporters of marijuana-law liberalization can take solace in the fact that the study found that the availability of medical marijuana did not lead to increased use of harder drugs like heroin or cocaine. But it would be naive to think that relaxing legal restrictions on marijuana wouldn’t lead to more marijuana use, or the use of intoxicating substances in general.

In the end, however, the argument for ending marijuana prohibition isn’t that pot is good for you, but that it’s a prohibition that creates more social harm than legal pot would. Freedom, as the saying goes, isn’t free.

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