Alcohol quantity and quality price elasticities:quantile regression estimates

Pryce, Rob and Hollingsworth, Bruce Philip and Walker, Ian (2018) Alcohol quantity and quality price elasticities:quantile regression estimates. European Journal of Health Economics. ISSN 1618-7598

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Abstract

Many people drink more than the recommended level of alcohol, with some drinking substantially more. There is evidence that suggests that this leads to large health and social costs, and price is often proposed as a tool for reducing consumption. This paper uses quantile regression methods to estimate the differential price (and income) elasticities across the drinking distribution. This is also done for on-premise (pubs, bars and clubs) and off-premise (supermarkets and shops) alcohol separately. In addition, we examine the extent to which drinkers respond to price changes by varying the ‘quality’ of the alcohol that they consume. We find that heavy drinkers are much less responsive to price in terms of quantity, but that they are more likely to substitute with cheaper products when the price of alcohol increases. The implication is that price-based policies may have little effect in reducing consumption amongst the heaviest drinkers, provided they can switch to lower quality alternatives.

Item Type:
Journal Article
Journal or Publication Title:
European Journal of Health Economics
Uncontrolled Keywords:
/dk/atira/pure/subjectarea/asjc/2700/2719
Subjects:
ID Code:
129315
Deposited By:
Deposited On:
05 Dec 2018 13:22
Refereed?:
Yes
Published?:
Published
Last Modified:
23 Sep 2020 04:50