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> If you buy meat from the dodgy guy in a pub then it’s cheaper. I don't know about that. First of all, I've never had a dodgy guy in a pub try to sell me meat

> If you buy meat from the dodgy guy in a pub then it’s cheaper. I don't know about that. First of all, I've never had a dodgy guy in a pub try to sell me meat. Second of all, the market for meat, at least in the U.S., is relatively unconstrained and therefore the prices are pretty reflective of the cost to produce (including the costs for the various middlemen in the chain, etc.). So with meat, if some dodgy guy is selling it for cheaper, it's probably because it's subpar product in some way or another. Televisions from a van? Stolen. Has nothing to do with economics -- the guy didn't pay the costs of producing those televisions, so his prices don't reflect them. Among your selection of analogies, only the cigarette one seems comparable. But even with this it's a little different. In that case, the cigs are cheaper because the tax is not being paid. That might be a factor in the black market price difference for weed in Canada, but according to this article, price manipulation by producers is a big factor, which isn't reflected in the cigarette analogy.

Closi 5y ago
Ha, maybe getting dodgy people selling you meat in a pub is a unique UK experience then! Of course there are differences between all of these analogies, because there isn't anything exactly like the drugs trade and everything will have a difference, I just mean that in every example I can think of where I could buy the same product from illegitimate and legitimate sources, the illegitimate source is cheaper (so I don't know why we would assume it would be any different here). > In that case, the cigs are cheaper because the tax is not being paid. Well that's interesting, as Weed sales have between 27% - 38% tax in California and OP said that there was a 34% price increase compared to illegitimate sources, so actually the tax rate is approximately equal to the difference in cost here. (Source: https://www.leafly.com/news/lifestyle/california-weed-tax-guide https://www.leafly.com/news/lifestyle/california-weed-tax-gu...)

Closi 5y ago

Ha, maybe getting dodgy people selling you meat in a pub is a unique UK experience then! Of course there are differences between all of these analogies, because there isn't anything exactly like the drugs trade and everything will have a difference, I just mean that in every example I can think of where I could buy the same product from illegitimate and legitimate sources, the illegitimate source is cheaper (so I don't know why we would assume it would be any different here). > In that case, the cigs are cheaper because the tax is not being paid. Well that's interesting, as Weed sales have between 27% - 38% tax in California and OP said that there was a 34% price increase compared to illegitimate sources, so actually the tax rate is approximately equal to the difference in cost here. (Source: https://www.leafly.com/news/lifestyle/california-weed-tax-guide https://www.leafly.com/news/lifestyle/california-weed-tax-gu...)