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The demand for alcohol in the United Kingdom

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Author Info
David Blake
Angelika Nied
Abstract

Using the AIDS model, we show that there exists for the UK a stable long-run relationship between expenditure shares on beer, cider, spirits and wine, alcohol prices, total alcohol expenditure and a range of non-economic variables relating to advertising, licensing, the employment, social class and demographic characteristics of consumers, and climate. Our estimates of key price and income elasticities generally lie between those found from other time-series studies (which exclude most of these non-economic variables) and those found from cross-section studies (which generally include them). However, the restrictions required for separability, homegeneity and symmetry (although not those for perfect price aggregation) are decisively rejected.

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Article provided by Taylor and Francis Journals in its journal Applied Economics.

Volume (Year): 29 (1997)
Issue (Month): 12 (December)
Pages: 1655-1672
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Handle: RePEc:taf:applec:v:29:y:1997:i:12:p:1655-1672

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Ian Crawford & Sarah Tanner, 1995. "Cross-border shopping and alcohol taxation: some theory and evidence," IFS Working Papers W95/03, Institute for Fiscal Studies.
  2. Bayoumi, Tamim, 1993. "Financial Deregulation and Household Saving," Economic Journal, Royal Economic Society, vol. 103(421), pages 1432-43, November. [Downloadable!] (restricted)
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  3. Jones, Andrew M, 1989. "A Systems Approach to the Demand for Alcohol and Tobacco," Bulletin of Economic Research, Blackwell Publishing, vol. 41(2), pages 85-105, April.
  4. Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-76, March. [Downloadable!] (restricted)
  5. Stock, James H, 1987. "Asymptotic Properties of Least Squares Estimators of Cointegrating Vectors," Econometrica, Econometric Society, vol. 55(5), pages 1035-56, September. [Downloadable!] (restricted)
  6. Diewert, W.E. & Wales, T.J., 1991. "Flexible Functional Forms and Tests of Homogeneous Separability," UBC Departmental Archives 91-12, UBC Department of Economics.
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  7. Pesaran, M.H. & Shin, Y., 1995. "An Autoregressive Distributed Lag Modelling Approach to Cointegration Analysis," Cambridge Working Papers in Economics 9514, Faculty of Economics, University of Cambridge.
  8. Moschini, Giancarlo & Moro, D. & Green, R., 2004. "Maintaining and Testing Separability in Demand Systems," Staff General Research Papers 11247, Iowa State University, Department of Economics.
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  1. Henry Saffer & Dhaval Dave, 2006. "Alcohol advertising and alcohol consumption by adolescents," Health Economics, John Wiley & Sons, Ltd., vol. 15(6), pages 617-637. [Downloadable!]
    Other versions:
  2. John M. Eakins & Liam A. Gallagher, 2003. "Dynamic almost ideal demand systems: an empirical analysis of alcohol expenditure in Ireland," Applied Economics, Taylor and Francis Journals, vol. 35(9), pages 1025-1036, January. [Downloadable!] (restricted)
  3. Henry Saffer, 2000. "Alcohol Consumption and Alcohol Advertising Bans," NBER Working Papers 7758, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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