Estimation of Individual Demand for Alcohol
AbstractUsing individual data from RLMS, the longitudinal survey of the representative sample of the Russian population, we study static and dynamic models of demand for alcohol. We show the demand curve has traditional negative slope for any type of alcoholic drink: vodka, beer, and wine. We find substitution of moonshine for vodka with higher price on vodka and between vodka&beer with higher price on one of them. As a result of substitution vodka price has no impact on total ethanol consumption, while higher price on beer and wine reduce demand for ethanol. We also demonstrate that income has important effect on demand for alcoholic drinks. Risk to be drinker is rising with individual income. Higher income results in lower consumption of moonshine and in higher consumption of vodka, beer, and wine.
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Bibliographic InfoPaper provided by Center for Economic and Financial Research (CEFIR) in its series Working Papers with number w0089.
Length: 43 pages
Date of creation: Jan 2006
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Alcohol; Demand; Russia;
Find related papers by JEL classification:
- I1 - Health, Education, and Welfare - - Health
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-12-16 (All new papers)
- NEP-CIS-2006-12-16 (Confederation of Independent States)
- NEP-HEA-2006-12-16 (Health Economics)
- NEP-TRA-2006-12-16 (Transition Economics)
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