The Effect of Medical Marijuana Laws on the Health and Labor Supply of Older Adults: Evidence from the Health and Retirement Study

Abstract

Older adults are at elevated risk of reducing labor supply due to poor health, partly because of high rates of symptoms that may be alleviated by medical marijuana. Yet, surprisingly little is known about how this group responds to medical marijuana laws (MMLs). We quantify the effects of state medical marijuana laws on the health and labor supply of adults age 51 and older, focusing on the 55 percent with one or more medical conditions with symptoms that may respond to medical marijuana. We use longitudinal data from the Health and Retirement Study to estimate event study and differences-in-differences regression models. Three principle findings emerge from our analysis. First, active state medical marijuana laws lead to lower pain and better self-assessed health among older adults. Second, state medical marijuana laws lead to increases in older adult labor supply, with effects concentrated on the intensive margin. Third, the effects of MMLs 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 and the importance of including older adults in assessments of state medical marijuana laws.