In Vino Pecunia? The Association Between Beverage-Specific Drinking Behavior and Wages
AbstractThe positive association between moderate alcohol consumption and wages is well documented in the economic literature. Positive health effects as well as networking mechanisms serve as explanations for the "alcohol-income puzzle". Using individual-based microdata from the GSOEP for 2006, we confirm that this relationship exists for Germany as well. More importantly, we shed light on the alcohol-income puzzle by analyzing, for the first time, the association between beverage-specific drinking behavior and wages. In our analysis, we disentangle the general wage effect of drinking into diverse effects for different types of drinkers. Mincerian estimates reveal significant and positive relationships between wine drinkers and wages as well as between beverage-unspecific drinkers and wages. We are unable to detect endogeneity problems with the drinking variables, which speaks in favor of OLS regressions. When splitting the sample into age groups, the "wine gain" disappears for employees under the age of 35 and increases in size and significance for higher age groups. We also find a "beer gain" for residents of rural areas and a "cocktail gain" for residents of urban areas. Several explanations for our empirical results are discussed in view of the likelihood that the alcohol-income puzzle is a multicausal phenomenon.
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Bibliographic InfoArticle provided by Springer in its journal Journal of Labor Research.
Volume (Year): 30 (2009)
Issue (Month): 3 (September)
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Web page: http://www.springer.com/economics/journal/12122
Other versions of this item:
- Ziebarth, Nicolas R. & Grabka, Markus M., 2009. "In Vino Pecunia? The Association Between Beverage-Specific Drinking Behavior and Wages," EconStor Open Access Articles, ZBW - German National Library of Economics.
- Nicolas R. Ziebarth & Markus M. Grabka, 2008. "In Vino Pecunia?: The Association between Beverage-Specific Drinking Behavior and Wages," SOEPpapers on Multidisciplinary Panel Data Research 93, DIW Berlin, The German Socio-Economic Panel (SOEP).
- Nicolas R. Ziebarth & Markus M. Grabka, 2008. "In Vino Pecunia?: The Association between Beverage-Specific Drinking Behavior and Wages," Discussion Papers of DIW Berlin 779, DIW Berlin, German Institute for Economic Research.
- I10 - Health, Education, and Welfare - - Health - - - General
- I12 - Health, Education, and Welfare - - Health - - - Health Production
- J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
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