Teens’ alcohol consumption and schooling

While research outside economics has found that drinking has a negative effect on cognitive skills, some economists have failed to find any negative relationship between drinking and academic performance. This paper argues that the reason for this discrepancy is due to the way education is measured in the economic literature. Herein, binge drinking in the senior year of high school is found to reduce the probability of receiving a high school diploma and to increase the probability of graduating with a General Education Development (GED). Moreover, this study finds that alcohol policies do not affect the dropout rate measured at the age of 25, but they do affect the probability that a student will graduate on time. In conclusion, bingeing is found to be responsible for inducing individuals to temporarily drop out of school. Eventually, these individuals return to school to complete their education, most likely by obtaining a GED diploma.