The Effect of "Blue Laws" on Consumer Expenditures at Retail

Abstract

The retailing system is regulated in various fashions by governments at all levels. One instance of such regulation in the United States is "blue laws. " Blue laws are legally imposed restrictions on retail operating hours. They impose a temporal "burden" on consumers who would prefer to shop during the proscribed hours. However, as a form of "compensation," these laws cause prices to be lower than they otherwise would be, for they diminish retail costs. The precise relationship between "burden" and "compensation" is developed mathematically. Empirical evidence of the effect of blue laws on expenditures per household is then presented. While there is no effect of blue laws on retailing in the aggregate, this neutrality does not exist for all lines of retail trade. Some lines experience greater expenditures and some lesser expenditures.