The cannabis industry within the USA: the influence of gender on cannabis policy and sales

Abstract

Purpose Motivated by upper echelon theory, this paper aims to examine the association between gender and the cannabis industry in the USA from both policy and an organizational perspective. Design/methodology/approach This paper examines two novel data sets in two legal adult-use cannabis states. First, it examines how city council gender diversity relates to city opt-out measure decisions, barring cannabis operations and forgoing related tax revenues. Second, it examines how management gender diversity relates to organizational performance. Findings Results suggest that, from a policy perspective, cities with higher council gender diversity are less likely to propose an opt-out measure to city taxpayers. From an organizational perspective, results suggest that female representation at the highest level is associated with higher sales in the retail sector of the cannabis industry. Research limitations/implications Findings are somewhat limited by data availability and may not be generalizable to all adult-use legal states. While the study recognizes the possibility of self-selection bias in the results, robust analyses is performed to limit this possibility. Finally, while the study wholly recognizes that gender is not binary, it is limited to a binary gender variable based on the gender recognition software used in this study. It is also understood that this may not accurately capture the richness of a more inclusive examination of gender. Practical implications Results from this study inform communities on the impact of city council gender diversity on policy outcomes and related tax revenue levels. Further, results inform the adult-use cannabis industry on benefits derived from executive-level gender diversity. Social implications Evidence suggests that gender diversity has a significant impact on the adoption of legalized adult-use cannabis policy. Social benefits from legalization potentially include increased revenues from taxes, decreased spending on cannabis enforcement, decreased health costs and decreased drug-related violence. Many of these benefits substantially impact communities disproportionally burdened by former prohibition. Additionally, the results indicate that gender is associated with the level of sales within cannabis organizations, generating debate about the possibility of economic performance in the absence of historical executive gender barriers. Originality/value This paper provides an initial empirical examination of gender diversity within and around the rapidly evolving adult-use cannabis industry in the USA.