Study adds to confusion over private liquor stores

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A task force's argument that privatizing liquor stores leads to increased drinking will not have a changing impact on the debate over Pennsylvania's state stores, a Duquesne University expert predicted Thursday.

Antony Davies, associate professor of economics who has extensively studied the issue and favors privatization, noted that the finding by a panel appointed by the director of the U.S. Centers for Disease Control and Prevention contradicts a previous study by the agency.

Studies of the social impacts of private liquor sales have produced conflicting results, Mr. Davies said.

"Their findings don't surprise me," he said of the task force's report, which has yet to undergo peer review. "That's the state of the entire literature."

The diverse conclusions on whether private sales result in increased drinking, underage drinking, drunken driving and fatalities cast doubts on arguments against it, Mr. Davies said.

"If there is a relationship between privatization and worse social outcomes, I would expect to see a consistent and predominant result in the literature," he said.

The last time it studied the issue, in 2006 and 2007, the CDC found insufficient evidence of a link between privatization and increased drinking.

Mr. Davies, who with a co-researcher studied data from all 50 states over 25 years, concluded that state control of alcohol sales did not improve social outcomes. In one category, DUI fatalities, states with more control had higher death rates, he found.

The study was commissioned by the conservative Commonwealth Foundation, which favors privatization.

Mr. Davies said the arguments for privatization -- more convenience, better selection, more stores and longer hours -- don't necessarily mean people would drink more.

"If we privatize, private store owners are not looking to maximize sales. They're looking to maximize profits. That could mean raising prices and selling less," he said.

In West Virginia, which turned liquor sales over to the private sector in 1990, consumption rates did not increase, Mr. Davies found in his study.

Private operators also have an incentive to sell responsibly, so as not to jeopardize their investments, he said.

Foes of privatization hope to exploit the task force report in any legislative debate on the issue.

Another expert who has studied alcohol privatization, Alexander C. Wagenaar, a professor in the University of Florida's College of Medicine, said his own studies of privatization of wine sales in the 1980s consistently found that it boosted sales.

He said state-controlled liquor sales were an outgrowth of the failure of Prohibition, "a regulated system designed to make alcohol available but just to dampen it a bit. We don't want people to sell as much alcohol as possible."

Gov. Tom Corbett and some lawmakers are pushing to sell the state's 615 liquor stores to help plug a $4 billion budget deficit.

The head of the Pennsylvania Liquor Control Board on Wednesday urged a Senate committee to give the agency more flexibility in such matters as pricing and store hours to further "modernize."

Joe Conti, the CEO, told the Senate Law and Justice Committee that the LCB needs to open more stores on Sundays, for longer hours, and allow Pennsylvanians to have wine shipped directly to their homes.

Three Democratic lawmakers, including Sen. Jim Ferlo of Highland Park, said Thursday they are proposing legislation to keep the LCB by giving it more flexibility in purchasing, sales and hiring.

The CDC report and the Senate hearing illustrated that the debate has some double-edged swords.

The LCB and its supporters have long held that private liquor stores would lead to increased drinking. Yet Mr. Conti, in pitching for opening more LCB stores on Sunday, touted the fact that it would bring a multimillion-dollar increase in sales.

The CDC panel acknowledged privatization "also has generally been associated with an increase in the price of privatized beverages, which may be expected to lead to a decrease in consumption."

House Majority Leader Mike Turzai, R-Bradford Woods, has said legislation to privatize liquor sales could be introduced this summer.

"I keep hearing more and more polls indicating the public is in favor of this," Mr. Davies said. "If I had to give it odds, I'd put them in favor of privatization."


Jon Schmitz: jschmitz@post-gazette.com or 412-263-1868.


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