That is *not* true. Holland is now moving to make drugs and prostitution illegal. Their society is out of control.
What I wrote is a fact. Holland has a big problem with “drug tourists” from the surrounding countries which is why cities close to the borders want to (or already did) further regulate the selling of cannabis. Weren’t small border villages swamped by thousands by German/French/Belgian youths each day, the “legalization” would be an enormous success.
Prostitution is another matter. I have no problem with it here in Germany :).
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The study was funded by the U.S. National Institute on Drug Abuse (NIDA) and the Dutch Ministry of Health.
http://www.ucsc.edu/currents/03-04/05-03/drug_study.html
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I've seen government figures that show The Netherlands had a lower rate of heroin addiction than Singapore or the U.S. in the mid to late 1990's. I'll try to dig them up if anyone requests.