Estimating the Effect of Changes in Kansas Liquor Retail Laws

Abstract

Currently in the state of Kansas sales of packaged alcohol are allowed only at specialized stores. This study attempts to estimate the potential effect the removal of this restriction would have on the retail sector structure and employment. We do this by examining the retail market structure across a sample of states with and without the restriction. Our results predict a modest increase in state employment and earnings due to deregulation of alcohol sales. However, that result has low statistical significance. Overall, there is not enough evidence to support the claim that deregulation would have a positive effect on Kansas economy.