Two States Are Cutting Back on Alcohol Regulations

Earlier this week, voters in the state of Washington passed Initiative 1183 which will close state-run liquor stores and allow for privately owned retail stores to sell liquor. This move effectively ends the state’s 78 year-old monopoly on the sale of alcohol. In a similar move this week, voters in Georgia showed an overwhelming support for repealing the state’s “blue laws” which prohibited the sale of liquor on Sunday.

With regards to Washington, the move to privatize the sale of liquor is certainly not a new idea. In fact, just last November, citizens in the state of Washington voted on two ballot initiatives, each attempting to end the state’s reign over the sale of alcohol.  However, neither ballot received enough votes to become law.

It is of no surprise that heated debates often arise when the state control of alcohol is questioned. Naturally, various questions arise in regard to liquor privatization. For instance, what will happen to the people currently employed in Washington’s state-run liquor stores? More importantly, though, what effects, if any, will privatization have on social outcome measures such as alcohol consumption and/or alcohol-related traffic fatalities?

These are precisely the questions that Mercatus scholars Antony Davies and John Pulito seek to address in their paper titled “Binge Thinking.”

In regards to job loss, the authors argue that although privatization may initially cause some job loss among individuals working in state-run liquor stores, it’s important to recognize that

many of the jobs will not disappear, but will merely shift from the public to private sector.

As Davies and Pulito further point out, one of the common arguments against the liberalization of alcohol control laws is the idea that

because state stores are not profit driven like private firms, privatization would result in increased alcohol consumption and problems associated with alcohol consumption, such as impaired driving.

However, the authors find evidence suggesting that

 States that recently privatized their liquor industries experienced a significant decline in per-capita alcohol consumption.


 States that have liquor controls experience significantly higher DUI-related fatality rates than states without controls.

Therefore, by liberalizing their alcohol control laws, Washington and Georgia may have created safer and more efficiently run alcohol industries. The other 17 “control states” should consider making similar moves.

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About Ben VanMetre

Ben VanMetre is an MA Fellow at the Mercatus Center at George Mason University. Before joining Mercatus, Ben earned his Bachelor of Arts degree from Beloit College where he double majored in Economics and Management and Psychology. His research interests include international and state-based development issues, entrepreneurship, institutional arrangements, and economic freedom. His work has appeared in Forbes, Economic Affairs, the Cato Journal, the Journal of Business and Economic Perspectives, the Journal of the James Madison Institute, the Free Market Foundation, and the second volume of the Wealth and Wellbeing of Nations.