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European Journal of Law and Economics

, Volume 37, Issue 3, pp 381–392 | Cite as

A note on social drinking: In Vino Veritas

  • Justus HaucapEmail author
  • Annika Herr
Article

Abstract

It has been a persistent phenomenon in many societies that a large proportion of alcohol consumption takes place in company of other people. While the phenomenon of social or public drinking is well discussed in disciplines such as social psychology and anthropology, economists have paid little attention to the social environment of alcohol consumption. This paper tries to close this gap and explains social drinking as a trust facilitating device. Since alcohol consumption tends to make some people (unwillingly) tell the truth, social drinking can eventually serve as a signaling device in social contact games.

Keywords

Public drinking Alcohol consumption Social contact games Trust Alcohol-wage-puzzle Alcohol-income-puzzle 

JEL Classification

C72 D71 L14 

Notes

Acknowledgments

For helpful discussions and comments we want to thank Björn Frank, Tobias Just, Mike Murphy, Christian Wey and an anonymous referee of this journal as well as conference participants of the Beeronomics 2011 conference in Munich. A very first version of this paper was written in 1997 while Justus Haucap was a visiting scholar at the Institute of Management, Innovation, and Organization (IMIO) at the Haas School of Business, University of California, Berkeley, the hospitality of which is most gratefully acknowledged.

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Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  1. 1.Düsseldorf Institute for Competition Economics (DICE)Heinrich-Heine-Universität DüsseldorfDüsseldorfGermany

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