Introduction
Five communities across the United States have decriminalized psychedelic compounds such as magic mushrooms and San Pedro cactus. As I have written about drug policy, I have been following these developments with a lot of curiosity given how I assumed scheduled psychedelics such as magic mushrooms, or psilocybin, would remain scheduled for the rest of this republic’s existence. But what an opportunity to study the effect of these unprecedented policy changes!
Imagine the following thought experiment if you would. Using the thought experiment command available in some future version of Stata,1 let’s say I could collect a census of Americans that it included the universe of psychedelic users before and after the decriminalization took place in some cities. Furthermore, assume my magical dataset had linked mental health outcomes such as depression. I want to use difference-in-differences to estimate an average causal effect of magic mushrooms on depression. Can I?2
But le…
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