Endogenous Drinking Age Laws and Highway Mortality Rates of Young Drivers

This paper presents estimates of the effects of the drinking age and
beer taxes on youth motor vehicle mortality. The data set employed is a
time series, from 1975 to 1981, of cross sections of the 48 contiguous states.
Separate regressions for 15 to 11 year olds, 18 to 20 year olds and
21 to 24 year olds are presented. A simultaneous estimation model is used
to account for the endogeneity .of the drinking age. The results show that
during the sample period an increase in the drinking age to 21, which is
approximately 8 percent, would have reduced mortality in the 18 to 20 year
old group by approximately 14 percent. Also a 100 percent increase in the
real beer tax, which is approximately $1.50 per case, would reduce highway
mortality of 18 to 20 year olds by about 19 percent. This increase in the
beer tax would also reduce mortality by about 8 percent for 15 to 17 year
olds and by about 18 percent for the 21 to 24 year olds.