Drink, but Please Don’t Drive: Spillover Effects of Ride-Sharing on Alcohol Sales and Drunk Driving Arrests

In an effort to provide new insights into the sharing economy, the current research examines its combined spillover effects on both alcohol sales and drunk driving arrests. In an analysis of how ride-sharing affects sales of alcohol at restaurants and bars, a generalized difference-in-differences model of monthly sales gathered from alcohol-selling establishments in Texas reveals that Uber availability increases monthly sales of alcohol by 10.1%, compared with cities where Uber is unavailable. A complementary study of the effect of Uber availability on drunk driving arrests helps address public safety concerns related to increased alcohol consumption. In detail, data from San Antonio, Texas, indicate that Uber availability leads to a 5% reduction in daily drunk driving arrests, with greater relative declines among members of minority populations and young people. These findings add to research on the sharing economy by illuminating some meaningful complementary effects, which also have crucial implications for policy makers seeking to craft appropriate regulations and for marketers seeking to communicate the value proposition of sharing economy services.