“In things you cannot make up, Oregon sales per adult along the Idaho border are 420% the statewide average,” says Josh Lehner, an economist with the Oregon Office of Economic Analysis (OEA).
The Oregon-Idaho border has seen a 420% increase in marijuana sales and no, that’s not a joke. Recreational marijuana is legal in Oregon, but not Idaho, though experts at the OEA don’t believe that Idaho residents are the only ones contributing to the massive increase in sales. Lehner also stated in his report for the OEA that the border sales can also be attributed to individuals from any state coming in and purchasing marijuana legally, as well as Oregon residents themselves who purchase their marijuana from the border.
While other state residents, and residents of Oregon itself, can be held responsible for the boost in the marijuana economy, Washington, another recreationally legal state, has seen an increase in sales along their border with Idaho as well. Lehner states that these Idaho border increases are a result of an economic pattern known as the “border effect.”
Relatively self-explanatory, the “border effect” is a “phenomenon observed when neighboring jurisdictions have different rules, regulations or tax rates for one industry or product,” according to Lehner. Obviously, Idaho shares a border with two legal states, making it one of the greatest modern examples of the border effect in current day markets. Idaho doesn’t even have legal medical marijuana, so it makes sense that the residents would use their neighboring states to make the purchases, even if it is a risky game.
“About 75% of marijuana sales in Oregon and 35% of sales in Washington in counties along the borders with Idaho appear to be due to the border effect. Obviously recreational marijuana is not legal in Idaho, but even after throwing the data into a rough border tax model that accounts for incomes, number of retailers, tax rates and the like, there remains a huge border effect,” Lehner said.
When comparing both Oregon and Washington border sales coming in from Idaho residents, reports show that Oregon has seen much more success (420%’s worth), which is most likely due to the fact that Oregon has less of a tax on marijuana. Washington also has much fewer dispensary retailers along their border, and they’re more centrally located within the state. Numerically speaking, Oregon sales are 16% more per capita compared to Washington.
A 420% sales increase in itself seems already massively successful, however, that number is quickly expected to change, and not in the way you’d likely expect. Recreational marijuana sales in general are predicted to increase even more within the next coming years as more states loosen their strict policies, and more federal regulation begins to take place.
In Oregon specifically, the OEA reports that they expect their sales to grow up to 80% at least within the next year as the economy begins to shift. The report’s projections claim the state will see an increase in overall household incomes for Oregon residents, a population increase (as expected every year), and a social shift as well in which marijuana will be deemed more socially acceptable as it rises in popularity and legality throughout the United States.
Eric Mastrota is a Contributing Editor at The National Digest based in New York. A graduate of SUNY New Paltz, he reports on world news, culture, and lifestyle. You can reach him at firstname.lastname@example.org.