Compliance and effectiveness of alcohol prohibition: evidence from India

Ghanshyam Sharma ()
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Ghanshyam Sharma: RV University

Economics of Governance, 2025, vol. 26, issue 4, No 2, 526 pages

Abstract: Abstract In this paper, I capture the heterogeneous impact of a comprehensive statewide alcohol prohibition in Bihar. Despite draconian penal provisions and strict enforcement, I find only a six percent decline in alcohol drinkers driven by sharper declines among the socially backward communities (SC/ST). I show evidence that the prohibition has acted as a deterrent for less frequent drinkers and had no impact on daily drinkers. I detect sharper declines in soft alcohol drinkers compared to hard alcohol drinkers. I find evidence for bootlegging as Bihar’s interior districts have experienced a sharper fall in alcohol drinkers compared to border districts. Finally, I show proof of underreporting in self-reported alcohol consumption.

Keywords: Alcohol Prohibition; Incidence of Compliance; Alcohol Prohibition (search for similar items in EconPapers)
JEL-codes: D02 H11 K42 Z18 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s10101-025-00337-z

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