State Liquor Licensing, Implicit Contracting, and Dry/Wet Counties
Local option liquor laws are generally interpreted as granting vote rs the right to choose between allowing and prohibiting alcoholic bevera ge sales. This paper argues that the real choice confronting voters i s between legal sales according to state-prescribed rules and illegal sales according to an informal set of locally-determined rules. Give n this choice, rational voters will choose the option with the lower relative price. State laws restricting the number of licenses that can be issued in legally-wet jurisdictions prove to be more powerful than religious preferences in explaining the pattern of dry counties. Copyright 1988 by Oxford University Press.
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Volume (Year): 26 (1988)
Issue (Month): 3 (July)
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