I somehow doubt that those people would stop going out and getting drunk during the evening if there were fewer/no taxis. They'd just be driving themselves.
Sure, maybe you could push it out of one neighborhood and into another, and the residents of Wrigleyville might be all for that, but is that actually much of a net gain for society in general?
I'd rather have drunks clogging sidewalks and taxis clogging roads, than drunks clogging roads.
I see... I guess one possible solution would be to make liquor licenses non-transferable, and then only issue them to businesses that are not located close to some threshold of other license holders.
Calibrating those thresholds to not generate more traffic (as people barhop with cabs instead of walking between bars) and to not kill the nightlife completely would probably proof challenging though.
If you only issue licenses to businesses that aren't close to other businesses, you've created an artificial scarcity. That's fine, but the economically optimal solution to scarce licensing is auctioning or, if that doesn't work, secondary markets.
Sure, maybe you could push it out of one neighborhood and into another, and the residents of Wrigleyville might be all for that, but is that actually much of a net gain for society in general?
I'd rather have drunks clogging sidewalks and taxis clogging roads, than drunks clogging roads.