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Alcohol – Excessive Consumption: Privatization of Retail Alcohol Sales

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What the CPSTF Found

About The Systematic Review

The CPSTF finding is based on evidence from a systematic review of 18 studies (search period through October 2007).

The review was conducted on behalf of the CPSTF by a team of specialists in systematic review methods, and in research, practice, and policy related to preventing excessive alcohol consumption.

Context

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Summary of Results

Detailed results from the systematic review are available in the CPSTF Finding and Rationale Statement pdf icon [PDF - 162 kB].

The systematic review included 18 studies.

  • Seventeen studies assessed the effects of privatization on per capita alcohol sales, a well-established proxy for excessive alcohol consumption and related harms.
    • Overall, there was a 44.4% median increase in per capita sales of privatized alcoholic beverages within the jurisdiction that underwent privatization during the years following privatization of retail alcohol sales (17 studies).
    • During this same time frame, sales of nonprivatized alcoholic beverages within the jurisdiction that underwent privatization decreased by a median of 2.2% (9 studies).
    • One study in Finland assessed the effects of privatization for groups reporting different levels of alcohol consumption. It found privatization increased consumption across all groups.
  • One study in Sweden found that re-monopolizing the sale of medium-strength beer was associated with a general reduction in alcohol-related harms.

Summary of Economic Evidence

An economic review of this intervention was not conducted because the CPSTF recommends against use of the intervention.

Applicability

Applicability of this intervention across different settings and populations was not assessed because the CPSF recommends against use of the intervention.

Evidence Gaps

Additional research and evaluation are needed to answer the following questions and fill existing gaps in the evidence base.

  • What is the relationship between privatization and patterns of excessive alcohol consumption (e.g., binge drinking) and alcohol-related harms? Cohort studies in the United States would be especially useful.
  • What would be the impact of increased government control over alcohol sales (e.g., re-monopolization) on excessive alcohol consumption and related harms, were such events to occur in the U.S. or other high-income nations?
  • How do the effects of privatization observed in this review vary by the degree of government regulation and other specific parameters of the privatization?
  • What would the economic impact of privatization be in the United States? The anticipated economic effects of privatization include a large, but short-term, source of revenue to states; a potential increase in healthcare and criminal justice costs; and productivity losses from expected increases in excessive alcohol consumption owing to greater availability and/or lower prices.
  • What are the effects of different specific approaches to privatization on state revenues associated with sales and taxes on alcoholic beverages?

Study Characteristics

  • The effects of 12 distinct privatization events were assessed as well as one instance of remonopolization.
  • The privatization events assessed were in seven U.S. states; two Canadian provinces; and Finland.
  • All studies used alcohol sales data as an index of population-level alcohol consumption except for one study that assessed changes in individual-level consumption.
  • The privatization events assessed in these studies occurred between 1950 and 2000.

Publications