Using a cost benefit analysis; analyze the recent decision for the Dutch government to ban the sale of Marijuana to tourists, and control the sale to citizens through ‘ID’s
The answer must include:
1) What a cost benefit analysis is and how it is beneficial in answering the above question.
2) Cost benefit analysis relies on the addition of positive factors (such as a reducing the crime rate associated with drugs) and the subtraction of negative ones (expected loss in revenue and taxation for the government, illegal market creation) to determine a net result, it is also known as running the numbers.
3) The answer must include numerate examples of the projected loss and gain for the government. As the ban is set to enforce on the 1st of January 2013, you are expected to provide hypothetical revenue loss and gain. However any projection must be substantiated with concise references.
4) The method by which you project the loss of revenue and taxation in (2) must be clearly stated.