A test of prohibition's effect on alcohol production and consumption using crop yields

Griffin Edwards and Travis Howe

Southern Economic Journal, 2015, vol. 81, issue 4, 1145-1168

Abstract: The effect of alcohol prohibition in the United States has been the subject of continuing debate. Due to a lack of data, one question that remains unanswered is the effect prohibition had on the actual production of alcohol. This article attempts to answer this question by estimating prohibition's impact on the yields of grains that constitute the principal inputs in alcohol production. Using a variety of data sources and exploiting the variation in timing of state prohibition law adoption, we estimate the effect of prohibition on several measures of crop production. Our preferred identification strategy compares contiguous counties in states with differing prohibition laws. Our findings suggest that state prohibition laws decreased the production of barley and may have increased the production of corn. Using these estimates, we calculate that prohibition decreased alcohol production, and by extension consumption, by at least 18 gallons per adult per year.

Date: 2015
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https://doi.org/10.1002/soej.12025

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Persistent link: https://EconPapers.repec.org/RePEc:wly:soecon:v:81:y:2015:i:4:p:1145-1168

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