Economics essay Ashmith

What are the various effects on different stakeholders of Amsterdam banning Marijuana
Smoking on Streets of Red-Light District?
Source: https://www.nytimes.com/2023/02/10/world/europe/amsterdam-red-light-cannabis.html

Amsterdam is one of the most well-known cities for its vibrant nightlife and legal marijuana
consumption. Recently, the city has decided to ban marijuana smoking on the streets of its
famous Red-Light District. The improved quality of life for the citizens of Amsterdam and its
visitors can be seen as a positive outcome of this decision. Amsterdam has taken a stance
against the negative externalities associated with marijuana smoking by banning it on the
streets of the Red-Light District

Effect on residents

The ban on marijuana smoking in the Red-Light District has had a mixed effect on the local
residents. On one hand, it has reduced the amount of second-hand smoke in the area, making it
a healthier place to live. On the other hand, many of the residents rely on the tourism generated
by marijuana smoking, and now that it's been outlawed, their incomes have taken a hit. The ban
has also been met with some criticism, with some arguing that it unfairly targets marijuana
smokers and does not address the underlying issues of addiction and mental health associated
with marijuana use.

Effect on environment

One of the primary positive externalities of this decision is the reduction of air pollution. Without
marijuana smoking on the streets, the air quality in the Red-Light District will improve
significantly.nThis improved air quality can have a range of health benefits for the citizens of
Amsterdam and its visitors, such as reducing the risk of respiratory diseases and allergies.
Another positive externality of the ban on marijuana smoking on the streets of the Red-Light
District is the reduction of noise pollution. With fewer people smoking on the streets, the noise
levels in the area will be reduced.

Effects on businesses and tourism

The ban on marijuana smoking in the Red-Light District has had a negative impact on
businesses in the area. Many of the businesses rely on the revenue generated from marijuana
smoking tourists and now that it's been outlawed, their profits have taken a hit. Additionally, the
ban has caused a decrease in foot traffic, resulting in fewer customers and lower
sales.Business owners have had to come up with creative ways to make up for the lost revenue,
such as offering discounts or providing additional services. However, the effects of the ban are
still being felt, and many businesses are struggling to make ends meet. The decrease in
demand has caused a decrease in revenue for marijuana sellers, which has led to a decrease in
the number of jobs in the area. The ban on marijuana smoking in the Red-Light District has had
a negative effect on tourists in the area. Many of the tourists come to the area specifically to
smoke marijuana, and now that it's been outlawed, they are no longer able to do so.
Additionally, the ban has caused a decrease in foot traffic, resulting in fewer tourists and lower
sales for businesses in the area. Tourists were forced to formulate different ideas to make up for
the lost experience, such as visiting other areas of Amsterdam or participating in other activities.

The effect of the ban on businesses is that the demand of marijuana will shift the demand curve
to the left due to the set regulations. This leads to a decrease in price as supply increases and
demand decreases causing a surplus in the Markey. The decrease in demand has also led to a
decrease in the number of tourists visiting the Red-Light District. This has had a negative impact
on the local businesses, as they have seen a decrease in revenue due to the decrease in
tourism.

Effect on government

The ban on marijuana smoking in the Red-Light District has had a mixed effect on the
government. On one hand, it has reduced the amount of second-hand smoke in the area,
making it a healthier place to live. On the other hand, the ban has caused a decrease in foot
traffic, resulting in fewer taxes being collected from businesses in the area. The government has
had to come up with creative ways to battle the issue of the loss in revenue by increasing the
specific tax on services, this leads to an increase in overall price of the service.
Conclusion

The ban on marijuana smoking in Amsterdam is likely to remain in place for the expected future,
as the city continues to take a stance against the negative externalities associated with
marijuana use.The ban has been credited with reducing the number of cases of respiratory
illnesses and addiction associated with marijuana use in the city, and is likely to remain in place
for the foreseeable future.