The effect of medical marijuana laws on the health and labor supply of older adults: Evidence from the Health and Retirement Study

Lauren Hersch Nicholas, Johanna Catherine Maclean

NBER Working Paper No. 22688
Issued in September 2016, Revised in March 2018
NBER Program(s):Health Economics

Older adults have the highest rates of many health conditions for which medical marijuana may be effective in moderating symptoms and are at elevated risk of reducing labor supply due to poor health. Surprisingly little is known about how this group responds to medical marijuana laws. We provide the first estimates of the effects of state medical marijuana laws on the health and labor supply of adults age 51 and older, focusing on those with medical conditions that may respond to medical marijuana. We use longitudinal data from the Health and Retirement Study to study these questions using differences-in-differences regression models. Three principle findings emerge from our analysis. First, we document that medical marijuana law passage leads to reductions in chronic pain and improvements in self-assessed health among older adults. Second, we show that passage of a state medical marijuana law leads to increases in older adult labor supply, with effects concentrated on the intensive margin. Third, effects are largest among older adults with a health condition that would qualify for legal medical marijuana use under current state laws. Findings highlight the role of health policy in supporting work among older adults.

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Document Object Identifier (DOI): 10.3386/w22688

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