Tobacco & Cannabis: The Evolution of Pertinent Rules & Regulations and Subsequent Financial Ramifications

Avisto, Palmer (2016) Tobacco & Cannabis: The Evolution of Pertinent Rules & Regulations and Subsequent Financial Ramifications. Undergraduate thesis, under the direction of Bonnie Van Ness from Finance, University of Mississippi.

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Palmer Avisto SMBHC Thesis 5.2016.pdf

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My thesis will discuss the evolution of the regulations surrounding tobacco and cannabis and the subsequent financial ramifications later posed on pertaining companies and the industries themselves. I will also briefly discuss the evolution of tobacco advertisements and the introduction of e-cigarettes into the tobacco market. Concerning newly legalized cannabis stores, I will discuss the struggle to acquire financial tools, the state-Federal disagreement, and proposed solutions to those issues. Both having been deemed “public enemy number one,” I will compare marijuana and tobacco regarding health effects, profitability after new laws, and their overall economic profitability for the country. I researched and summarized all pertinent regulations for the two industries and analyzed the available annual reports for the major tobacco companies. The marijuana industry is relatively new, and thus I used figures given in recent articles on the industry. I discovered the tobacco industry evolved from zero regulation to becoming one of the most regulated industries in America. On the other hand, the marijuana industry has gone from being illegal to slowly gaining legality on certain state levels. It is currently fighting for acknowledgement by the Federal government as a legal business, and pushing for government regulation of the industry. Originally, regulations and laws imposed on the tobacco industry did not affect the tobacco companies in terms of sales, net earnings, or stock prices. However, the Master Settlement Agreement of 1998 greatly affected the tobacco industry, and the effects turned out to be long-term. Financial ramifications followed with every additional passing act; however, the industry created a new product out of the bad publicity and financial effects – electronic cigarettes. That product was so successful it became its own industry. The marijuana industry is still pushing for Federal approval and thus, it is still struggling on the financial level in terms of obtaining necessary financial tools. In conclusion, I propose the marijuana industry be granted legality, medicinally, on the Federal level replacing the tobacco industry as an economic force for the United States.

Item Type: Thesis (Undergraduate)
Creators: Avisto, Palmer
Student's Degree Program(s): B.B.A. in Managerial Finance
Thesis Advisor: Bonnie Van Ness
Thesis Advisor's Department: Finance
Institution: University of Mississippi
Subjects: H Social Sciences > HG Finance
Depositing User: Virginia Palmer Avisto
Date Deposited: 25 May 2016 18:13
Last Modified: 18 May 2018 15:51

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