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The (Short-Term) Individual Welfare Consequences of an Alcohol Ban

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  • René Petilliot

Abstract

This paper provides the first empirical analysis of the (short-term) welfare consequences of an alcohol ban. Using subjective well-being data to proxy individual welfare, I apply a regression discontinuity design where the date of the implementation of the ban in the German federal state of Baden-Wuerttemberg functions as discontinuity. I find that the ban reduces life satisfaction of the total population and the subpopulation of drinkers, while life satisfaction of nondrinkers is unaffected. My findings are well in line with the rational addiction model perspective.

Suggested Citation

  • René Petilliot, 2018. "The (Short-Term) Individual Welfare Consequences of an Alcohol Ban," SOEPpapers on Multidisciplinary Panel Data Research 979, DIW Berlin, The German Socio-Economic Panel (SOEP).
  • Handle: RePEc:diw:diwsop:diw_sp979
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    References listed on IDEAS

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    1. Marcus, Jan & Siedler, Thomas, 2015. "Reducing binge drinking? The effect of a ban on late-night off-premise alcohol sales on alcohol-related hospital stays in Germany," EconStor Open Access Articles, ZBW - Leibniz Information Centre for Economics, pages 55-77.
    2. Matthew Rabin & Ted O'Donoghue, 1999. "Doing It Now or Later," American Economic Review, American Economic Association, vol. 89(1), pages 103-124, March.
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    4. Odermatt, Reto & Stutzer, Alois, 2015. "Smoking bans, cigarette prices and life satisfaction," Journal of Health Economics, Elsevier, vol. 44(C), pages 176-194.
    5. Becker, Gary S & Murphy, Kevin M, 1988. "A Theory of Rational Addiction," Journal of Political Economy, University of Chicago Press, vol. 96(4), pages 675-700, August.
    6. Joshua D. Angrist & Jörn-Steffen Pischke, 2009. "Mostly Harmless Econometrics: An Empiricist's Companion," Economics Books, Princeton University Press, edition 1, number 8769.
    7. Gruber, Jonathan & Koszegi, Botond, 2004. "Tax incidence when individuals are time-inconsistent: the case of cigarette excise taxes," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 1959-1987, August.
    8. Jonathan Gruber & Botond Köszegi, 2001. "Is Addiction "Rational"? Theory and Evidence," The Quarterly Journal of Economics, Oxford University Press, vol. 116(4), pages 1261-1303.
    9. Daniel Kuehnle & Christoph Wunder, 2013. "The Effects of Smoking Bans on Self-Assessed Health: Evidence from Germany," SOEPpapers on Multidisciplinary Panel Data Research 586, DIW Berlin, The German Socio-Economic Panel (SOEP).
    10. Gruber Jonathan H & Mullainathan Sendhil, 2005. "Do Cigarette Taxes Make Smokers Happier," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(1), pages 1-45, July.
    11. Gert G. Wagner & Joachim R. Frick & Jürgen Schupp, 2007. "The German Socio-Economic Panel Study (SOEP) – Scope, Evolution and Enhancements," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 127(1), pages 139-169.
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    More about this item

    Keywords

    Alcohol ban; Well-being; Life satisfaction; Welfare; Addiction; Regression discontinuity design;

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • D60 - Microeconomics - - Welfare Economics - - - General
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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