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Joel Slemrod
  Joel Slemrod
 

Love thy neighbor? States should leave drinking age alone

7/24/2008 --

ANN ARBOR, Mich.—States currently considering reducing the drinking age aren't doing their neighbors any favors.

While opponents contend, of course, that dropping the minimum legal drinking age from 21 to 18 or 19 will lead to more alcohol-related teen traffic deaths in those affected states, a University of Michigan researcher says that lowering the age requirement will cause fatal crash rates to increase in neighboring states, as well.

New research by U-M economist Joel Slemrod of the Ross School of Business and colleague Michael Lovenheim of Stanford University shows that 18- and 19-year-old drivers who live in another state---but within 25 miles of a state with a lower drinking age—are more likely to be involved in a fatal crash.

"The availability of different policies just across the border—be they lower excise taxes or the legal sale of fireworks—can compromise the impact of a jurisdiction's own policies and cause efficiency costs as consumers pursue the goods," said Slemrod, professor of business economics and public policy. "In the case of legalized drinking, being able to drink legally across the border has an additional implication for social costs because the act of drinking and then driving home drunk can itself be dangerous, even fatal, both to the cross-border consumers and other unfortunate drivers and pedestrians."

In their study, Slemrod and Lovenheim evaluated the effect of states' different minimum legal drinking ages on alcohol-related traffic deaths since 1977. For the years after 1987, when 21 became the legal drinking age in all 50 states, their analysis focused on states bordering Canada and Mexico.

The researchers found that raising the legal drinking age to 21 has resulted in about 5 percent fewer drunk-driving fatal crashes for 18-year-olds and about 4 percent fewer for 19-year-olds.

However, in counties within 25 miles of a bordering state with a lower minimum drinking age, the likelihood of an 18-year-old being involved in a fatal crash increases 0.5 percent. For 19-year-olds, the rate increase is 0.1 percent.

"While the effects are more muted for 19-year-olds, the results for both 18- and 19-year olds are consistent with teens evading alcohol restrictions by driving to states where they can legally purchase alcohol," said Slemrod, who also notes there is little evidence of a "cross-border" effect on 20-year-olds.

Overall, the researchers say that previous studies have underestimated the total effect of increases in the legal drinking age.

"That unequal restrictions across unmonitored borders can induce the very behaviors the restrictions are meant to eliminate is well documented with respect to cigarettes," Slemrod said. "When the behavior in question is teenage drunk driving, evasion itself can exact a toll in terms of lives."

For more information, contact:
Bernie DeGroat, (734) 936-1015 or 647-1847, bernied@umich.edu