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The Effect of Alcohol Consumption on Earnings

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Author Info
Barrett, Garry F
Abstract

The effect of alcohol consumption on the earnings of full-time male workers is analysed using the Australian National Health Survey 1989-90. A multinomial logit choice model is used to explain workers' choice of drinking status and to correct for selection bias in the earnings equation estimation. It is found that moderate drinking leads to a significant earnings premium relative to abstention and heavy drinking. The results are consistent with moderate drinking improving individual's health and hence productivity and earnings. Copyright 2002 by The Economic Society of Australia.

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Article provided by The Economic Society of Australia in its journal The Economic Record.

Volume (Year): 78 (2002)
Issue (Month): 240 (March)
Pages: 79-96
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Handle: RePEc:bla:ecorec:v:78:y:2002:i:240:p:79-96

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  1. Levy, Amnon, 2002. "A Theory of Chronic Loss, Suffering and Alcoholism," Economics Working Papers wp02-16, School of Economics, University of Wollongong, NSW, Australia. [Downloadable!]
  2. Ziggy MacDonald & Michael A. Shields, 2004. "Does problem drinking affect employment? Evidence from England," Health Economics, John Wiley & Sons, Ltd., vol. 13(2), pages 139-155. [Downloadable!]
  3. Keng, Shao-Hsun & Huffman, Wallace, 2005. "Binge Drinking and Labor Market Success: A Longitudinal Study on Young People," Staff General Research Papers 12299, Iowa State University, Department of Economics.
  4. Bruce Headey & Mark Wooden & Gary Marks, 2004. "The Structure and Distribution of Household Wealth in Australia," Melbourne Institute Working Paper Series wp2004n12, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne. [Downloadable!]
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  5. Shao-Hsun Keng & Wallace Huffman, 2007. "Binge drinking and labor market success: a longitudinal study on young people," Journal of Population Economics, Springer, vol. 20(1), pages 35-54, February. [Downloadable!] (restricted)
  6. Pinka Chatterji & Jeffrey DeSimone, 2006. "High School Alcohol Use and Young Adult Labor Market Outcomes," NBER Working Papers 12529, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  7. Pinka Chatterji & Margarita Alegría & Mingshan Lu & David Takeuchi, 2007. "Psychiatric disorders and labor market outcomes: evidence from the National Latino and Asian American Study," Health Economics, John Wiley & Sons, Ltd., vol. 16(10), pages 1069-1090. [Downloadable!]
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  8. Lixin Cai, 2007. "Effects of Health on Wages of Australian Men," Melbourne Institute Working Paper Series wp2007n02, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne. [Downloadable!]
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