Student performance and legal access to alcohol

I recently read an interesting 2013 paper (ungated earlier version here) by Jason Lindo, Isaac Swensen, and Glen Waddell (all from University of Oregon), published in the Journal of Health Economics. In the paper the authors investigated the effect of attaining the minimum legal drinking age (which is 21 in the U.S.) on college students' academic performance. This is a fairly important question, since we'd like to know if drinking makes young people worse off (and if so, by how much), so knowing if it interferes with their studies (and if so, by how much) is one way of getting an answer to the broader question.

Lindo et al. used student-level academic transcript data from the University of Oregon, and compared "a student's grades after turning 21 to what would be expected based on his average prior performance and accumulated experience". Here's what they found:

The results from our preferred approach indicate that students' grades fall below their expected levels by approximately 0.03 standard deviations upon being able to drink legally, a modest amount compared to the 0.06 to 0.13 standard-deviation effect estimated in earlier research. The effect is statistically significant, manifests in the term a student turns 21, and persists into later academic terms. In addition, we find that the effects on academic performance are especially large for females, low-ability males, and males who are most likely from financially disadvantaged backgrounds.

It is worth repeating their main result with some emphasis added: Being legally able to drink is associated with lower academic performance by 0.03 standard deviations. In other words, this is one of those cases where the effect is statistically significant, but the size of the effect means that it is economically meaningless.

Having said that we don't know what the mean GPA or standard deviation of GPA are as they aren't reported in the paper, so we can't really evaluate how 'large' the effect is. However, the authors note that this is "the equivalent of causing a student to perform as if his or her SAT score were 20 points lower". Given the SAT has a standard deviation of about 100, this is equivalent to lowering their SAT scores by 0.2 standard deviations, i.e. the difference between being in the 61st percentile and the 64th percentile of the SAT distribution. That is, a pretty small effect.

It would be interesting to replicate this sort of analysis for New Zealand though, but in the context of the drinking age changing from 20 to 18 in the 1990s (if the academic data are available). It may be that there are greater effects on attaining the minimum legal drinking age for younger people, but I wouldn't bet too much on it.

Overall, file this paper under 'nothing much to see here'.