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How cannabis legalization increase in GDP? Explain succinctly with GDP calculation in mind.

How cannabis legalization increase in GDP? Explain succinctly with GDP calculation in mind.

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Answer #1

We are assuming that canabis are widely brought and sold in the economy but illegally, any activity that is done illegally is not made part of the GDP calculation. When this sale is legalised anytime these cannabis are sold the sale will be made part of the GDP, this will increase the GDP in numbers.

Legalising it will also increase the employment in the market and more employment will lead to higher demand for different goods and induce the multiplier effect further increasing the GDP.  

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