Research Details

Abstract

Legalization of drugs in the US has been growing, along with calls for reparations to the Black community through priority licensing to commercialize drugs. However, consumer responses to Black ownership of drugbased products remain unknown. We experimentally tested for the effect of ‘Black-owned’ labels in cannabis and psychedelic categories. In study 1, we report two field experiments that measured traffic to a website about psychedelic substances. We find that an ad with (vs. without) a Black-owned label increased the click through rate by 21%; but this improvement did not generalize to a Woman-owned label, suggesting that minority ownership alone does not drive these effects. In study 2, using an online panel with 59% Black participants, we randomly assigned participants to consider cannabis (vs. candy) gummies presented with (vs. without) a Black-owned label. For cannabis, only White participants reported higher intentions to consume the product with (vs. without) a Black-owned label. For candy, the pattern reversed, and Black participants indicated higher intentions to consume the Black-owned product. These effects were robust to controlling for participants’ gender, political ideology, religiosity, anti-Black prejudice, and support of cannabis legalization. We discuss potential mechanisms and address the broader discourse on racial reparations through drug commercialization.

Type

Working Paper

Author(s)

Chethana Achar

Date Published

2023

Citations

Achar, Chethana. 2023. Black-Owned drugs: Consumer responses to Black ownership labeling on regulated substances.