Is reducing the number of bottle shops to curb domestic violence a ‘bone-headed’ idea?

According to La Trobe University economist, Professor Harry Clarke, there’s a “bone-headed argument making the rounds” that reducing the number of liquor stores in a neighbourhood will reduce domestic violence.

The bone-headed argument comes from Michael Livingston, a research fellow at the Turning Point Alcohol and Drug Centre in Melbourne. According to the Sydney Morning Herald, Mr Livingston studied the density of liquor outlets in Victoria.

As you increase bottle shops in a neighbourhood you increase rates of domestic violence and rates of chronic disease. We know that they’re concentrated up to eight times more in poor neighbourhoods than rich neighbourhoods in Victoria.

Mr Livingstone acknowledges domestic violence is caused by a range of factors, but reckons reducing the number of packaged liquor outlets has got the potential to make a difference. “A lot of energy”, he says, “has gone into regulating the late-night economy, the pubs and bars, and that’s having some impact. I think packaged liquor is the next area that needs to be focused on.”

Geographical access to alcohol outlets has also been linked to other crimes. It’s part of a wider perspective that, for example, also argues the density of fast food outlets should be reduced in order to limit obesity and other health-related issues. It’s part of the same view that underpins Michelle Obama’s claim that childhood obesity in the US is linked to “food deserts” – poor urban neighbourhoods lacking stores selling fresh vegetables and fruit.

Note that Mr Livingston’s proposition isn’t to prohibit liquor outlets, but to reduce the number below the level the market signals it wants. It’s also proposed that this only be done in certain areas, specifically poorer neighbourhoods. It relies on the idea that buyers would be deterred because they’d have to travel further to buy their supplies – in effect the price would rise.

I don’t think it’s a good idea. Like Professor Clarke, I think reducing the number of liquor outlets would only have a small effect on domestic violence and other alcohol-related issues in the affected neighbourhood.

The reason is demand for desirable products isn’t much affected by increases in price (unless the increase is extremely large). This applies especially to something like alcohol which is mood changing and potentially addictive. That’s why, as Professor Clarke says, governments like to tax alcohol and cigarettes.

Were the number of outlets to be reduced, the most likely outcome is the sorts of buyers who drink excessively and behave criminally would simply pay the higher price. That is, they’d either travel further to get their bottles than they used to, or they’d adapt by, say, buying larger quantities less frequently.

There’s a parallel between Mr Livingstone’s proposition and Kevin Rudd’s alcopops fiasco. Faced with a higher tax on alcopops, teen drinkers simply shifted to cheaper forms of alcohol they could flavour with juice. There was no reduction in binge drinking. The Government didn’t get that teenagers drink for the effect, not the flavour.

Mr Livingston’s proposal isn’t equitable. All residents of poor neighbourhoods where liquor outlets had been culled would be worse off because their bottled supplies would in effect become more expensive i.e. harder to get. That would include the vast majority who no doubt drink responsibly and behave appropriately. It would be like a consumption tax that only applies to residents of poorer neighbourhoods.

It’s also possible such an initiative might result in a net increase in total kilometres of driving, given all residents in an affected neighbourhood would on average be further from a retail outlet after the cull. It’s hard to know because it would depend on how consumers adapted, but it’s certainly a serious possibility.

However in my view the really big downside is this sort of thinking deflects attention from root causes. Yes, in some areas there’s a correlation between the number of liquor outlets and the level of crime, but there’s not a significant causal link. It’s therefore not a solution. Much better in my view to focus limited resources on the real causes.

Other factors related to socioeconomic and cultural background are far more likely to explain differences in how people drink and whether or not they display anti-social behaviour, than proximity to a bottle shop. I worry policy-makers who cull liquor shops would think they’d already done the heavy lifting.

A good example of why I worry is Michelle Obama’s fascination with the dubious idea of food deserts. It’s a terrible waste of the enormous political capital she brings to the issue of childhood obesity. But hold your fire on food deserts for the moment – I’ll look at that next time (update: see here).