RS 2 Marijuana And The European Dream

This blog post is my analysis on the podcast Episode 395: Maastricht, Marijuana And The European Dream by Planet Money. This podcast audio was available on August 17, 2012. In Maastricht it is legal for the sales of Marijuana. This is a great reason why many tourist go here and cross borders to do so. Marijuana is sold in coffee shops and the owners were doing very well. Recently the mayor decided to ban the sale of marijuana to tourists and only local citizens are able to buy it. This then required all tourists to show ID upon entering coffee shops. Eventually they required any citizen who wanted to purchase marijuana to be registered. This steered even more customers away knowing that it would show they were registered for buying drugs.

One economic guidepost which this situation can be an example of is an economic action often generates a secondary effect in addition to their immediate effects. After the mayor decided to put a ban on marijuana to tourists, the effect on sales dropped drastically. Majority of the people purchasing were tourists and now the coffee shop owners are the ones it hurts the most. They opened up their shops while there was no ban in effect, and then were blindsided with a ban  to kill their business. It also hurts the mayor too with him knowing or not. Maastricht received a big chunk of their economic income from these tourist coming in mainly for the sole purpose of being able to purchase marijuana and now that was taken away from them.