One of the key implications of rational behaviour is that people respond to incentives. When the cost of something decreases, we tend to do more of it. Costs are not limited to monetary costs, or even to costs that might be measured in monetary terms. Consider alcohol consumption at a bar. The 'full cost' of alcohol consumption at the bar includes the price of the alcohol purchased, and the monetary cost of travelling to and from the bar, but also the increased risk of bodily harm, and the increased risk of doing something stupid that the drinker may regret later. If any of those costs decrease, people would tend to drink more.
Now consider the introduction of cheaper travel options, like Uber. This lowers the travel cost for the drinker to and from the bar. Drinkers would tend to drink more in response to this. That is the hypothesis that this recent article by Keith Teltser (Georgia State University), Conor Lennon (University of Louisville), and Jacob Burgdorf (US Department of Justice), published in the Journal of Health Economics (ungated earlier version here), seeks to investigate.
Teltser et al. look at the introduction of UberX into US cities, and how that is related to alcohol consumption behaviour. They collect data on UberX entry and exit dates for different US cities, and use data from the CDC's Behavioral Risk Factor Surveillance System Selected Metropolitan/Micropolitan Area Risk Trends (BRFSS SMART) over the period from 2009 to 2017, for those aged 21 to 64 years. Using a difference-in-differences regression approach, they find that:
...UberX is associated with a 3.6% increase in the average number of drinks per drinking day, a 2.7% increase in drinking days, and a 5.4% increase in total drinks... We also find a 4.3% increase in the maximum number of drinks in a single drinking occasion and a 0.8 percentage point (1.33%) increase in the number of people who report any alcohol consumption over the previous 30 days.
By themselves though, those results are not definitively causal. However, Teltser et al. go on to show that:
...Uber’s impact is larger among individuals aged 21-34, including a 7.4% increase in total drinks, a 9.5% increase in binge drinking instances, and a 1.5 percentage point (2.3%) increase in the number who report any alcohol consumption in the past 30 days. Further, we find that UberX does not appear to increase drinking among those aged 65 or older.
Since younger people were more likely to have a smartphone (and more likely to have the Uber app) than older people (especially considering this was the period from 2009 to 2017), that increases the plausibility that UberX is causing more alcohol consumption. Interestingly, they also find that:
...the effects on drinking are larger in areas where transit is weaker, which reinforces the idea that Uber is facilitating away-from-home alcohol consumption.
Public transport is a substitute for UberX, so where public transport is already highly accessible, you'd expect UberX to have a smaller effect, and that is what they find. They also find that UberX is associated with increases in employment and total employee earnings at bars, but much smaller effects at restaurants (so, they aren't simply picking up some general increase in night-time entertainment).
Decreasing the full cost of drinking at bars, by making it less expensive to travel to and from bars, increases alcohol consumption. That is likely to be associated with increased harm, including harm to health from over-intoxication, or violence. However, before we conclude that UberX has an overall negative effect, we need to consider that the availability of UberX might also offset some harm by reducing the incidence of drunk driving. Teltser et al. didn't look at the effects of UberX on harm, or on drink driving, which is something we would need more information on before drawing a firm conclusion.
No comments:
Post a Comment