THE IMPACT OF LARGE CONTAINER BEER PURCHASES ON ALCOHOL-RELATED FATAL VEHICLE ACCIDENTS

Omer Hoke and Chad Cotti

Contemporary Economic Policy, 2015, vol. 33, issue 3, 477-487

Abstract: type="main" xml:id="coep12089-abs-0001"> Using a fixed effect weighted least square model, we examine how changes in the share of beer purchases from large containers (>12 oz.) impact alcohol-related fatal accidents. We find that, after holding beer purchases and overall alcohol-consumption constant, an increase in total beer purchases from containers greater than the standard size of 12 oz. increases alcohol-related fatal accidents. We confirm our results persist across several investigations of robustness, as well as the use of instrument variables methods. Outcomes suggest that policy makers should consider differential excise taxes for the purchase of larger than standard size beer containers. Such a policy would likely reduce the number of alcohol-related fatal vehicle crashes and help to internalize the negative externalities associated with drunk driving. At the very minimum, these results suggest that individuals prone to dangerous levels of drunk driving are the consumers that most prefer large container size consumption. This is consistent with the idea that binge drinkers and beer drinkers are much more likely to drive while legally intoxicated . ( JEL I18, K4)

Date: 2015
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