IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/17762.html
   My bibliography  Save this paper

Do Consumers Exploit Precommitment Opportunities? Evidence from Natural Experiments Involving Liquor Consumption

Author

Listed:
  • B. Douglas Bernheim
  • Jonathan Meer
  • Neva K. Novarro

Abstract

This paper provides evidence concerning the extent to which consumers of liquor employ commitment devices. One widely recommended commitment strategy is to regulate alcohol consumption by deliberately manipulating availability. The paper assesses the prevalence of the “availability strategy” by evaluating the effects of policies that would influence its effectiveness – specifically, changes in allowable Sunday sales hours. It finds that consumers increase their liquor consumption in response to extended Sunday on-premises sales hours, but not in response to extended off-premises sales hours. The latter finding is inconsistent with widespread use of the availability strategy.

Suggested Citation

  • B. Douglas Bernheim & Jonathan Meer & Neva K. Novarro, 2012. "Do Consumers Exploit Precommitment Opportunities? Evidence from Natural Experiments Involving Liquor Consumption," NBER Working Papers 17762, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:17762
    Note: PE
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w17762.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Houser, Daniel & Schunk, Daniel & Winter, Joachim & Xiao, Erte, 2018. "Temptation and commitment in the laboratory," Games and Economic Behavior, Elsevier, vol. 107(C), pages 329-344.
    2. B. Douglas Bernheim & Debraj Ray & Şevin Yeltekin, 2015. "Poverty and Self‐Control," Econometrica, Econometric Society, vol. 83(5), pages 1877-1911, September.
    3. Jonathan Gruber & Botond Köszegi, 2001. "Is Addiction "Rational"? Theory and Evidence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(4), pages 1261-1303.
    4. Nava Ashraf & Dean Karlan & Wesley Yin, 2006. "Tying Odysseus to the Mast: Evidence From a Commitment Savings Product in the Philippines," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(2), pages 635-672.
    5. Michael F. Lovenheim & Daniel P. Steefel, 2011. "Do blue laws save lives? The effect of Sunday alcohol sales bans on fatal vehicle accidents," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 30(4), pages 798-820, September.
    6. Xavier Giné & Dean Karlan & Jonathan Zinman, 2010. "Put Your Money Where Your Butt Is: A Commitment Contract for Smoking Cessation," American Economic Journal: Applied Economics, American Economic Association, vol. 2(4), pages 213-235, October.
    7. Gharad Bryan & Dean Karlan & Scott Nelson, 2009. "Commitment Contracts," Working Papers 980, Economic Growth Center, Yale University.
    8. McMillan, G.P. & Lapham, S. & Steenberg, B., 2006. "Legalized Sunday packaged alcohol sales and alcohol-related traffic crashes and crash fatalities in New Mexico," American Journal of Public Health, American Public Health Association, vol. 96(11), pages 1944-1948.
    9. Pascaline Dupas & Jonathan Robinson, 2013. "Why Don't the Poor Save More? Evidence from Health Savings Experiments," American Economic Review, American Economic Association, vol. 103(4), pages 1138-1171, June.
    10. Heaton, Paul, 2012. "Sunday liquor laws and crime," Journal of Public Economics, Elsevier, vol. 96(1), pages 42-52.
    11. Stehr, Mark, 2007. "The Effect of Sunday Sales Bans and Excise Taxes on Drinking and Cross–Border Shopping for Alcoholic Beverages," National Tax Journal, National Tax Association;National Tax Journal, vol. 60(1), pages 85-105, March.
    12. Ornstein, Stanley I & Hanssens, Dominique M, 1985. "Alcohol Control Laws and the Consumption of Distilled Spirits and Beer," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 12(2), pages 200-213, September.
    13. Stehr Mark F, 2010. "The Effect of Sunday Sales of Alcohol on Highway Crash Fatalities," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-22, August.
    14. repec:lmu:muenar:19377 is not listed on IDEAS
    15. Lovenheim, Michael F. & Slemrod, Joel, 2010. "The fatal toll of driving to drink: The effect of minimum legal drinking age evasion on traffic fatalities," Journal of Health Economics, Elsevier, vol. 29(1), pages 62-77, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Christensen, Else Gry Bro & Nafziger, Julia, 2016. "Packaging of sin goods – Commitment or exploitation?," Journal of Economic Behavior & Organization, Elsevier, vol. 122(C), pages 62-74.
    2. Julie L. Hotchkiss & Yanling Qi, 2017. "Impact of Allowing Sunday Alcohol Sales in Georgia on Employment and Hours," Southern Economic Journal, John Wiley & Sons, vol. 84(2), pages 504-524, October.
    3. Sung-Jin Cho & John Rust, 2015. "Precommitments for Financial Self-Control:Evidence from Credit Card Borrowing," 2015 Meeting Papers 33, Society for Economic Dynamics.
    4. Colin P. Green & Maria Navarro Paniagua, 2016. "Play Hard, Shirk Hard? The Effect of Bar Hours Regulation on Worker Absence," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 78(2), pages 248-264, April.
    5. Evan Herrnstadt & Ian Parry & Juha Siikamäki, 2015. "Do alcohol taxes in Europe and the US rightly correct for externalities?," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 22(1), pages 73-101, February.
    6. Marcos Y. Nakaguma & Brandon J. Restrepo, 2018. "Restricting access to alcohol and public health: Evidence from electoral dry laws in Brazil," Health Economics, John Wiley & Sons, Ltd., vol. 27(1), pages 141-156, January.

    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. B. Douglas Bernheim & Jonathan Meer & Neva K. Novarro, 2016. "Do Consumers Exploit Commitment Opportunities? Evidence from Natural Experiments Involving Liquor Consumption," American Economic Journal: Economic Policy, American Economic Association, vol. 8(4), pages 41-69, November.
    2. Jungtaek Lee & Baris K. Yörük, 2014. "Does Legalization of Sunday Alcohol Sales Increase Crime?," CESifo Working Paper Series 5065, CESifo.
    3. Marcos Y. Nakaguma & Brandon J. Restrepo, 2018. "Restricting access to alcohol and public health: Evidence from electoral dry laws in Brazil," Health Economics, John Wiley & Sons, Ltd., vol. 27(1), pages 141-156, January.
    4. Laureti, Carolina & Szafarz, Ariane, 2023. "Banking regulation and costless commitment contracts for time-inconsistent agents," Economic Modelling, Elsevier, vol. 129(C).
    5. John Beshears & James J. Choi & Christopher Harris & David Laibson & Brigitte C. Madrian & Jung Sakong, 2015. "Self Control and Commitment: Can Decreasing the Liquidity of a Savings Account Increase Deposits?," NBER Working Papers 21474, National Bureau of Economic Research, Inc.
    6. Ubfal, Diego, 2016. "How general are time preferences? Eliciting good-specific discount rates," Journal of Development Economics, Elsevier, vol. 118(C), pages 150-170.
    7. 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 and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 0, pages 55-77.
    8. Green, Colin P. & Heywood, John. S. & Navarro, Maria, 2014. "Did liberalising bar hours decrease traffic accidents?," Journal of Health Economics, Elsevier, vol. 35(C), pages 189-198.
    9. Emma Boswell Dean & Frank Schilbach & Heather Schofield, 2017. "Poverty and Cognitive Function," NBER Chapters, in: The Economics of Poverty Traps, pages 57-118, National Bureau of Economic Research, Inc.
    10. Christine L. Exley & Jeffrey K. Naecker, 2017. "Observability Increases the Demand for Commitment Devices," Management Science, INFORMS, vol. 63(10), pages 3262-3267, October.
    11. Francesconi, Marco & James, Jonathan, 2021. "None for the Road? Stricter Drink Driving Laws and Road Accidents," Journal of Health Economics, Elsevier, vol. 79(C).
    12. Beshears, John & Choi, James J. & Harris, Christopher & Laibson, David & Madrian, Brigitte C. & Sakong, Jung, 2020. "Which early withdrawal penalty attracts the most deposits to a commitment savings account?," Journal of Public Economics, Elsevier, vol. 183(C).
    13. Frank Schilbach, 2019. "Alcohol and Self-Control: A Field Experiment in India," American Economic Review, American Economic Association, vol. 109(4), pages 1290-1322, April.
    14. Colin Green & John Heywood & Maria Navarro Paniagua, 2013. "Did liberalising English and Welsh bar hours cause traffic accidents?," Working Papers 33996659, Lancaster University Management School, Economics Department.
    15. Anett John, 2020. "When Commitment Fails: Evidence from a Field Experiment," Management Science, INFORMS, vol. 66(2), pages 503-529, February.
    16. Christopher Carpenter & Carlos Dobkin, 2010. "Alcohol Regulation and Crime," NBER Chapters, in: Controlling Crime: Strategies and Tradeoffs, pages 291-329, National Bureau of Economic Research, Inc.
    17. Avdic, Daniel & von Hinke, Stephanie, 2021. "Extending alcohol retailers’ opening hours: Evidence from Sweden," European Economic Review, Elsevier, vol. 138(C).
    18. Cobb-Clark, Deborah A. & Kassenboehmer, Sonja C. & Sinning, Mathias G., 2016. "Locus of control and savings," Journal of Banking & Finance, Elsevier, vol. 73(C), pages 113-130.
    19. Heaton, Paul, 2012. "Sunday liquor laws and crime," Journal of Public Economics, Elsevier, vol. 96(1), pages 42-52.
    20. Mark Dean & John McNeil, 2014. "Preference for Flexibility and Random Choice: an Experimental Analysis," Working Papers 2014-10, Brown University, Department of Economics.

    More about this item

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • I10 - Health, Education, and Welfare - - Health - - - General

    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:nbr:nberwo:17762. 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: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    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.