| Date Published: | December 1, 1997 |
| Author(s): | Douglas West |
| Research Topic(s): | Privatization |
| The purpose of this paper is to take the opportunity offered by the Alberta experience with liquor retailing privatization to examine the sort of market structure and its characteristics that are produced by market forces under privatization and to compare these with the market structure and characteristics of the government-owned system. The impact of government-imposed restrictions on the evolution of an efficient retail distribution system under privatization is also assessed. The paper begins with a description of Alberta's liquor distribution system when it was under government ownership and control. This is followed by a discussion of the privatization process, including the procedure used by the Alberta Liquor Control Board (ALCB) to dispose of its liquor stores, the reductions in ALCB staff and attempt to unionize private liquor store employees, new regulations affecting private liquor stores, new supplier arrangements with the ALCB, new flat markup on liquor products, and contracting out of the warehouse operation. The paper's next section analyzes the economic impacts of privatization. It finds that the number of private liquor stores is approximately triple the number of ALCB stores. Most of the ALCB stores in Calgary and Edmonton were converted to private liquor stores, but less than half of the ALCB stores in the rest of the province were converted to private stores. There has been a relatively small number of liquor store closures since privatization, and this might be partly explained by the fact that liquor store chains in Alberta account for less than 10 percent of all private liquor stores. The requirement of a uniform wholesale price is viewed as inhibiting the growth of liquor store chains and the realization of certain efficiencies in distribution that would accompany chain development. | |
| ISBN: | 1206-6257 |
| Type: | Studies & Reports |
| Free Download: | Download |
| Files: | Complete Publication |
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