Monday, January 12, 2009

A Market Solution to Drunk Driving?

Three married couples in South Florida have created a beer/cigarettes delivery service after a night of drinking and having no one sober enough to make another beer run. After cooking up the idea on a drunken Halloween night, they committed to the plan, took out business loans, etc., and have created "The Beer Runners."

For an order of over $20, they will deliver alcohol with a charge of $5 for the first three miles, and 65 cents for each mile over that. Their formula for success?
"You think what you would have to pay for court fees if you got a DUI, what's $10 to have beer delivered?" - Jon Fox, one of the owners

Here, we have a case where market incentives have created a for-profit service (beer delivery) that has significant positive externalities--that is, keeping drunk people from hitting the roads for a beer run. The question is, how long until a "sin tax" or something of the like is slapped on alcohol delivery services?

Props to Mark Perry's econ blog for the link.


Sam said...

Really interesting idea. I know there's been more than one occasion on which I had (somewhat drunkenly) considered the idea with friends. Sin taxes I think will end up a secondary issue -- unfortunately, I would suspect that it's only a matter of time before these entrepreneurs run into issues with liquor/beer licenses, legal liability (serving to already-very intoxicated individuals), and the like.

JPB said...

Expect a crackdown from local authorities for a) distributing intoxicants without a license and b) potentially providing alcohol to minors. Despite the precautions I'm sure they take, it will be a complaint--and they may even be the target of a sting.

Don't expect this to last, as good of an idea as it is.