I actually doubt that the prices would fall much if weed were legalized. In fact, it might go up in some places. The prices in any given area have pretty much already been set and are based on supply, demand, and what the local population can afford. Look at a product like Adobe Photoshop, a full legal copy is something like $600+. For a shitty little cd. Sure, a lot of r&d etc went into it but a lot goes into other software that only costs $50. So why is photoshop so expensive, because that's what people will pay. Once it's been established that people will pay a certain price it's unlikely that they'll go down.

Look at the situation in the cannabis clubs out here in California. This is weed which is being sold legally and which has been grown legally. Not to mention the fact that a huge portion of the domestic crop is grown here. Yet, prices in the cannabis clubs are as much, if not more, than what you'd pay for illegal weed.

If weed has traditionally been sold for $50-60 an 1/8th, it is doubtful that a legal seller would want to sell it for much less. It has already been established that such a price is acceptable. Yes, if the price falls more weed will potentially be sold for potentially greater profit. But that would level off pretty quickly. If the price of weed were to be cut in half the consumption level would need to double or more(given all other factors remain the same) in order to get the same amount of profit. But how many people would really double their consumption simply because the price has fallen? My guess is not too many.

What I could potentially see happening is a leveling off of prices across the country. You probably wouldn't see a situation like we have now where weed in San Francisco costs $60 an 1/8th and weed in Iowa costs $60 a 1/2. There might be some small regional differences to account for distribution costs but that is it. So, while the prices might go down a bit for some people they might go up for others.

Question for folks who've been to Amsterdam: What are the prices like there?