A new study by the investment firm, Bernstein, entitled Weekend Consumer Blast: Beer & Weed Revisited has shown that although eight of these United States have legalised cannabis for recreational usage, this hasn’t equated to less alcohol sales. The opposite had been predicted, and there were large-scale attempts by the $200bn-a-year alcohol industry to lobby against legalisation in the shape of four-figure donations to anti-cannabis campaigns by industry groups, for example, the $25,000 given by the 16 companies constituting Beer Distributors PAC in Massachusetts. But fears have not been borne out.
The case against
Bernstein commented that, at first glance, cannabis and alcohol would be regarded as “clear rivals” on the grounds that “every extra dollar spent on weed meant a dollar less on booze.” There would be less alcohol sold in the same way that an established curry house might lose customers to a new Italian restaurant. In some cases, however, there have actually been more rather than less alcohol sales.
But it never happened
In states where cannabis is permitted for medical reasons, there was 0.6 percent less alcohol sales in the three years preceding legalisation, but 0.1 percent more in the next three. Bernstein conceded that its analysis was limited to a few states, however, it would appear “beer and weed are complements rather than substitutes.” But then, both are vice industries.
Why is this?
32-year-old Justin Martz, the owner of Mr B’s Wine & Spirits in Denver, remarked that after recreational cannabis was legalised, “We’ve just seen phenomenal growth.” He speculated that a rising tide benefits all boats, but more specifically, according to Bernstein, the symbiosis could be because tokers had more money to piss away since the price of cannabis had fallen: in Washington, legalisation of cannabis reduced the price from $25 to $10 per gramme. The legal weed industry faces a number of problems, but this is still less than those of black market dealers who are striving to avoid imprisonment.
Another study by the National Bureau of Economic Research in 2014 agreed, finding that in seven states that allowed medical marijuana from 2004 to 2011, binge drinking – where at least four drinkies are consumed – increased by between six and nine percent. A third study, again recently publicised, this time by research firm Cowen & Co, concluded that the alcohol industry had been adversely affected by pot legalisation, but a major criticism of that is that it managed to neglect the impact of craft beer, whose makers have been oft observed by market pundits to have much in common with cannabis culture.
Bernstein assigned 10 analysts to its study, which examined market trends. It stated, “One does not need to look far into popular culture to see that beer and weed cultures can be highly complementary.” Other industries are also likely to benefit, particularly if they satisfy the munchies, with examples being Domino’s Pizza, the Mexican food chain, Chipotle, and Frito Lay, purveyor of salty snacks.