IDEAS home Printed from https://ideas.repec.org/a/wly/apecpp/v48y2026i2p447-461.html

Changes in Alcohol Retail Laws and Foot Traffic at Liquor Stores

Author

Listed:
  • Nathan Palardy
  • Marco Costanigro
  • Joshua Berning
  • Jude Bayham

Abstract

We study how expanding alcohol availability at grocery and convenience stores affects consumer traffic in liquor stores by leveraging recent changes in state‐level alcohol distribution laws in a difference‐in‐difference quasi‐experimental design. Results indicate that more extensive liberalization results in higher losses of traffic at liquor stores and that the impact is dynamic over time. Additionally, the overall impact at rural stores is larger compared to urban stores. We discuss the economic, geographic, and behavioral factors behind the heterogeneous impacts of the policy and develop a general theory of the effects of liberalization on the liquor store sector.

Suggested Citation

  • Nathan Palardy & Marco Costanigro & Joshua Berning & Jude Bayham, 2026. "Changes in Alcohol Retail Laws and Foot Traffic at Liquor Stores," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 48(2), pages 447-461, May.
    • Handle: RePEc:wly:apecpp:v:48:y:2026:i:2:p:447-461
    DOI: 10.1002/aepp.70037
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/aepp.70037
    Download Restriction: no
    File URL: https://libkey.io/10.1002/aepp.70037?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Metin Çakır & Xiangwen Kong & Clare Cho & Alexander Stevens, 2020. "Rural Food Retailing and Independent Grocery Retailer Exits," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(5), pages 1352-1367, October.
    2. Jeremy Horpedahl, 2021. "Bootleggers, Baptists and ballots: coalitions in Arkansas’ alcohol-legalization elections," Public Choice, Springer, vol. 188(1), pages 203-219, July.
    3. Alberto Abadie, 2005. "Semiparametric Difference-in-Differences Estimators," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 72(1), pages 1-19.
    4. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
    5. Allison Lacko & Shu Wen Ng & Barry Popkin, 2020. "Urban vs. Rural Socioeconomic Differences in the Nutritional Quality of Household Packaged Food Purchases by Store Type," IJERPH, MDPI, vol. 17(20), pages 1-17, October.
    6. Roger Betancourt & David Gautschi, 1990. "Demand Complementarities, Household Production, and Retail Assortments," Marketing Science, INFORMS, vol. 9(2), pages 146-161.
    7. Kilkenny, Maureen, 1998. "Transport Costs, the New Economic Geography, and Rural Development," Staff General Research Papers Archive 1201, Iowa State University, Department of Economics.
    8. Andrew J. Van Leuven & Sarah A. Low & Edward (Ned) Hill, 2023. "What side of town? How proximity to critical survival factors affects rural business longevity," Growth and Change, Wiley Blackwell, vol. 54(2), pages 352-385, June.
    9. Maureen Kilkenny, 1995. "Transport Costs and Rural Development," Food and Agricultural Policy Research Institute (FAPRI) Publications (archive only) 95-wp133, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    10. Dawn Thilmany & Nicole McKenney & David Mushinski & Stephan Weiler, 2005. "Beggar-thy-neighbor economic development: A note on the effect of geographic interdependencies in rural retail markets," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 39(3), pages 593-605, September.
    11. Panle Jia, 2008. "What Happens When Wal-Mart Comes to Town: An Empirical Analysis of the Discount Retailing Industry," Econometrica, Econometric Society, vol. 76(6), pages 1263-1316, November.
    12. Binzhe Wang & Matias Williams & Fábio Duarte & Siqi Zheng, 2022. "Demand for social interactions: Evidence from the restaurant industry during the COVID‐19 pandemic," Journal of Regional Science, Wiley Blackwell, vol. 62(3), pages 830-857, June.
    13. Jonathan Roth & Pedro H. C. Sant’Anna, 2023. "Efficient Estimation for Staggered Rollout Designs," Journal of Political Economy Microeconomics, University of Chicago Press, vol. 1(4), pages 669-709.
    14. Sant’Anna, Pedro H.C. & Zhao, Jun, 2020. "Doubly robust difference-in-differences estimators," Journal of Econometrics, Elsevier, vol. 219(1), pages 101-122.
    15. Hart, Jarrett & Alston, Julian M., 2020. "Evolving Consumption Patterns in the U.S. Alcohol Market: Disaggregated Spatial Analysis," Journal of Wine Economics, Cambridge University Press, vol. 15(1), pages 5-41, February.
    16. Yi Deng & Gabriel Picone, 2019. "An empirical analysis of entry and location decisions by bars and liquor stores," Empirical Economics, Springer, vol. 57(5), pages 1751-1782, November.
    17. Byrne, Paul & Nizovtsev, Dmitri, 2017. "Exploring the effects of state differences in alcohol retail restrictions," International Review of Law and Economics, Elsevier, vol. 50(C), pages 15-24.
    18. Abadie, Alberto & Diamond, Alexis & Hainmueller, Jens, 2010. "Synthetic Control Methods for Comparative Case Studies: Estimating the Effect of California’s Tobacco Control Program," Journal of the American Statistical Association, American Statistical Association, vol. 105(490), pages 493-505.
    19. Thomas J. Weinandy & Kuanchin Chen & Susan Pozo & Michael J. Ryan, 2024. "Twitter-patter: how social media drives foot traffic to retail stores," Journal of Marketing Analytics, Palgrave Macmillan, vol. 12(3), pages 551-569, September.
    20. Katja Seim & Joel Waldfogel, 2013. "Public Monopoly and Economic Efficiency: Evidence from the Pennsylvania Liquor Control Board's Entry Decisions," American Economic Review, American Economic Association, vol. 103(2), pages 831-862, April.
    21. Burgdorf, Jacob, 2019. "Impact of mandated exclusive territories in the US brewing industry: Evidence from scanner level data," International Journal of Industrial Organization, Elsevier, vol. 63(C), pages 376-416.
    22. ., 2017. "Enter in time: analysing dynamics in three empirical cases," Chapters, in: Understanding Collective Decision Making, chapter 6, pages 136-166, Edward Elgar Publishing.
    23. Callaway, Brantly & Sant’Anna, Pedro H.C., 2021. "Difference-in-Differences with multiple time periods," Journal of Econometrics, Elsevier, vol. 225(2), pages 200-230.
    24. Blair, John P. & Traynor, Thomas & Duan, Manjiang, 2004. "Retail Development in Rural Counties: Evidence from the Upper Midwest," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 34(01), pages 1-16.
    25. Gary S. Becker, 1983. "A Theory of Competition Among Pressure Groups for Political Influence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(3), pages 371-400.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Arne Henningsen & Guy Low & David Wuepper & Tobias Dalhaus & Hugo Storm & Dagim Belay & Stefan Hirsch, 2026. "Estimating Causal Effects With Observational Data: Guidelines for Agricultural and Applied Economists," Journal of Agricultural Economics, Wiley Blackwell, vol. 77(2), pages 356-382, June.
    2. Dmitry Arkhangelsky & Guido W. Imbens & Lihua Lei & Xiaoman Luo, 2024. "Design‐robust two‐way‐fixed‐effects regression for panel data," Quantitative Economics, Econometric Society, vol. 15(4), pages 999-1034, November.
    3. Hans-Bernd Schaefer & Rok Spruk, 2024. "Islamic Law, Western European Law and the Roots of Middle East's Long Divergence: a Comparative Empirical Investigation (800-1600)," Papers 2401.14435, arXiv.org, revised Mar 2024.
    4. Dmitry Arkhangelsky & Guido Imbens, 2023. "Causal Models for Longitudinal and Panel Data: A Survey," Papers 2311.15458, arXiv.org, revised Jun 2024.
    5. Roth, Jonathan & Sant’Anna, Pedro H.C. & Bilinski, Alyssa & Poe, John, 2023. "What’s trending in difference-in-differences? A synthesis of the recent econometrics literature," Journal of Econometrics, Elsevier, vol. 235(2), pages 2218-2244.
    6. Goodman-Bacon, Andrew, 2021. "Difference-in-differences with variation in treatment timing," Journal of Econometrics, Elsevier, vol. 225(2), pages 254-277.
    7. Callaway, Brantly & Karami, Sonia, 2023. "Treatment effects in interactive fixed effects models with a small number of time periods," Journal of Econometrics, Elsevier, vol. 233(1), pages 184-208.
    8. Kyunghoon Ban & D'esir'e K'edagni, 2022. "Robust Difference-in-differences Models," Papers 2211.06710, arXiv.org, revised Aug 2023.
    9. Yixiao Sun & Haitian Xie & Yuhang Zhang, 2025. "Difference-in-Differences Meets Synthetic Control: Doubly Robust Identification and Estimation," Papers 2503.11375, arXiv.org, revised Sep 2025.
    10. Yuhao Deng & Le Kang, 2026. "Doubly Robust Estimation of Treatment Effects in Staggered Difference-in-Differences with Time-Varying Covariates," Papers 2603.04080, arXiv.org.
    11. Brancati, Emanuele, 2022. "Help in a Foreign Land: Internationalized Banks and Firms’ Export," IZA Discussion Papers 15458, IZA Network @ LISER.
    12. Bahia, Kalvin & Castells, Pau & Cruz, Genaro & Masaki, Takaaki & Pedrós, Xavier & Pfutze, Tobias & Rodríguez-Castelán, Carlos & Winkler, Hernán, 2024. "The welfare effects of mobile broadband internet: Evidence from Nigeria," Journal of Development Economics, Elsevier, vol. 170(C).
    13. Martin Huber & Sarina Joy Oberhansli, 2026. "Difference-in-differences for mediation analysis using double machine learning," Papers 2602.23877, arXiv.org.
    14. Christian Alemán-Pericón & Alexander Ludwig & Christopher Busch & Raül Santaeulàlia-Llopis, 2022. "A Stage-Based Identification of Policy Effects," Working Papers 1369, Barcelona School of Economics.
    15. Andrea Albanese & Bart Cockx & Muriel Dejemeppe, 2022. "Long-Term Effects of Hiring Subsidies for Unemployed Youths - Beware of Spillovers," LISER Working Paper Series 2022-09, Luxembourg Institute of Socio-Economic Research (LISER).
    16. Tobler, Lina & Fervers, Lukas & Reiff, Annika, 2025. "Does more money help? The impact of the apprenticeship minimum wage on training offers and take-ups," SocArXiv hjb74_v1, Center for Open Science.
    17. Athey, Susan & Imbens, Guido W., 2022. "Design-based analysis in Difference-In-Differences settings with staggered adoption," Journal of Econometrics, Elsevier, vol. 226(1), pages 62-79.
    18. James M. Harrison & Darrell J. Glaser, 2025. "Hurdles to hops: How self‐distribution laws affect craft brewery output," Contemporary Economic Policy, Western Economic Association International, vol. 43(2), pages 292-318, April.
    19. Melnik, Walter & Smyth, Andrew, 2024. "R&D tax credits and innovation," Journal of Public Economics, Elsevier, vol. 236(C).
    20. Yusun Kim & Yilin Hou, 2025. "Property Valuation – Cycle Length and Assessment Outcome," The Journal of Real Estate Finance and Economics, Springer, vol. 71(4), pages 545-586, November.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:apecpp:v:48:y:2026:i:2:p:447-461. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://doi.org/10.1002/(ISSN)2040-5804 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.