The Effect of Alcohol Consumption on Labor Market Outcomes of Young Adults: Evidence from Minimum Legal Drinking Age Laws

Ceren Ertan Yoruk

The B.E. Journal of Economic Analysis & Policy, 2015, vol. 15, issue 3, 1297-1324

Abstract: This paper uses a regression discontinuity design to estimate the impact of the minimum legal drinking age (MLDA) laws on alcohol consumption and labor market outcomes of young adults. Using confidential data from the National Longitudinal Survey of Youth 1997 Cohort (NLSY97), I find that granting legal access to alcohol at age 21 leads to an increase in several measures of alcohol consumption. The discrete jump in the alcohol consumption at the MLDA has also negative spillover effects on the labor market outcomes of young adults. In particular, I document that the MLDA is associated with a 1 hour decrease in weekly working hours. However, the effect of the MLDA laws on wages is negative only under certain specifications. These results suggest that the policies designed to curb drinking may not only have desirable effects in reducing alcohol consumption among young adults but also have positive spillover effects on their labor market outcomes.

Keywords: alcohol consumption; employment; minimum legal drinking age; wages (search for similar items in EconPapers)
JEL-codes: I10 I18 J10 J20 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (1)

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DOI: 10.1515/bejeap-2014-0104

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