What are the policy lessons of National Alcohol Prohibition in the United States, 1920-1933?

Abstract

National alcohol prohibition in the United States between 1920 and 1933 is believed widely to have been a misguided and failed social experiment that made alcohol problems worse by encouraging drinkers to switch to spirits and created a large black market for alcohol supplied by organized crime. The standard view of alcohol prohibition provides policy lessons that are invoked routinely in policy debates about alcohol and other drugs. The alcohol industry invokes it routinely when resisting proposals to reduce the availability of alcohol, increase its price or regulate alcohol advertising and promotion. Advocates of cannabis law reform invoke it frequently in support of their cause. This paper aims: (i) to provide an account of alcohol prohibition that is more accurate than the standard account because it is informed by historical and econometric analyses; (ii) to describe the policy debates in the 1920s and 1930s about the effectiveness of national prohibition; and (iii) to reflect on any relevance that the US experience with alcohol prohibition has for contemporary policies towards alcohol. It is incorrect to claim that the US experience of National Prohibition indicates that prohibition as a means of regulating alcohol is always doomed to failure. Subsequent experience shows that partial prohibitions can produce substantial public health benefits at an acceptable social cost, in the absence of substantial enforcement.