Washington and Colorado Saw Spike in Tourism Following Marijuana Legalization

Washington and Colorado Saw Spike in Tourism Following Marijuana Legalization

Both Washington and Colorado saw a significant increase in tourism associated with the legalization of marijuana. This is according to a new study, titled (Pot)heads un bed: The effect of marijuana on hotel occupancy in Colorado and Washington, was published in the Journal of Regional Analysis & Policy.

For the study researchers compared rates of hotel occupancy in Colorado and Washington following legalization, and compared it with other states. They found a “large increase in hotel rooms rented in Colorado” following legalization.

“[L]egalization in Colorado is associated with an increase of nearly 51,000 hotel rooms rented per month [and] once commercial sale is permitted, there is an increase of almost 120,000 room rentals per month,” found the authors, who conclude:

“Marijuana legalization led to a larger increase in tourism in Colorado than Washington. One possible explanation is that Colorado is an easier travel destination than Washington. … Another possible explanation is that Colorado may have achieved a first mover advantage over Washington since it legalized commercial sale six months earlier than Washington. A third possible explanation is that Washington is adjacent to British Columbia which has a strong reputation for growing marijuana and a laid-back attitude toward marijuana consumption (though use remains illegal). While marijuana legalization increased tourism, especially in Colorado, the benefit may wane as additional states including California, Michigan, and Illinois, legalize the possession and sale of marijuana.”

The study’s abstract states:

This paper uses monthly hotel occupancy data to examine the effect of marijuana legalization on tourism in Colorado and Washington. The results indicate a large increase in hotel rooms rented in Colorado, with a considerably smaller effect for Washington. The effects are larger in both states once commercial sale is permitted above and beyond legalizing possession and individual cultivation. Marijuana legalization led to a larger increase in tourism in Colorado than Washington. One possibleexplanation is that Colorado is an easier travel destination than Washington because it is more centrallylocated and Denver’s airport is a major hub for United Airlines. Another possible explanation is thatColorado may have achieved a first mover advantage over Washington since it legalized commercial sale sixmonths earlier than Washington. A third possible explanation is that Washington is adjacent to BritishColumbia which has a strong reputation for growing marijuana and a laid back attitude toward marijuanaconsumption (though use remains illegal). While marijuana legalization increased tourism, especially inColorado, the benefit may wane as additional states including California, Michigan, and Illinois, legalize thepossession and sale of marijuana.

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