Wednesday, January 11, 2012

Fun Public Policy - Making Wine Cheaper Might Help Curb Binge Drinking

Well, that's counter-intuitive, via Ezra Klein:
In a working paper for the American Association of Wine Economists, Rickard and his team start off by looking at the states that allow grocery stores to sell wine, versus those that limit such sales to liquor stores. The increased competition of grocery stores selling wine, unsurprisingly, correlates with both lower wine prices and higher rates of wine consumption.

There’s a surprising, public health benefit that grows out of that: States where wine makes up a larger part of total alcohol consumption tend to have lower rates of traffic fatalities.
[I didn't realize there was an American Association of Wine Economists. I guess there really is an association for absolutely everything.]

I'll be the first to point out that correlation does not equal causation, but this is a pretty impressive chart, demonstrating the obvious correlation between consuming more wine as a percentage of total alcohol consumption and fewer traffic fatalities:


From the report, p. 13:
Overall, these results indicate that an increase in beer and spirit consumption, as a share of total alcohol consumption, increases traffic fatalities whereas an increase in wine consumption as a share of total alcohol consumption decreases traffic fatalities.
But what might be the causal relationship between these two variables, wine as a percentage of total alcohol consumption and traffic fatalities? A 2007 study from the Journal of Preventative Medicine found that wine is the form of alcohol that is least likely to be consumed in an episode of binge drinking, accounting for only 10 percent of all binge-drinking episodes, while beer accounted for two-thirds of all binge-drinking episodes. As binge drinking leads almost certainly to intoxication, I suppose it should actually come as no surprise that higher consumption of wine relative to other booze leads to fewer extremely intoxicated people and therefore to fewer traffic fatalities.

While it remains true that higher total alcohol consumption correlates with more traffic fatalities, as one would expect, it seems that the composition of what people drink matters, from a public policy perspective. Bizarrely enough, raising the price of beer and spirits and lowering the price of wine, thereby shifting alcohol consumption away from beer and spirits and towards wine while not increasing total alcohol consumption, might have rather large public health benefits in the form of reduced traffic fatalities. And that's in addition to the other health effects that moderate wine (especially red wine) consumption can bestow.

So, put down the beer and liquor bottles and raise your glass - cheers!

2 comments:

  1. Is it relevant that the high-fatality states are also mainly rural, and what cities they do have are sprawled?

    Is it also relevant that the low-fatality states are nearly all blue?

    -Andrew

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  2. Andrew,

    If you delve into the actual report, the authors post their regression tables where they control for things like miles traveled per driver, seat belt laws, and a number of other factors, and their results are robust even under these control variables.

    So, to answer your question, yes, those issues are relevant, but the authors account for at least some of them. And I think the fact that the low-fatality states are nearly all blue states only shows that blue states tend to drink more wine, while red states drink more beer - which perhaps isn't surprising from a cultural perspective, but I can't think of a causal mechanism for why that alone (as opposed to the other variables the authors control for, including some "cultural" variables) would have an effect on fatalities.

    -The Angry Bureaucrat

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