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Hurdle Models of Alcohol and Tobacco Expenditure in South African Households

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Author Info

  • Marc Ground

    ()
    (Department of Economics, University of Pretoria)

  • Steven F. Koch

    ()
    (Department of Economics, University of Pretoria)

Abstract

Estimates of participation or expenditure elasticities depend upon the assumptions made regarding the observation of zero expenditure at the household level. This research examines two single-hurdle models across two commodities for which nearly two-thirds of the observations are zero. The research shows that one hurdle model consistently outperforms the other, and does so for intuitively appealing reasons.

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Bibliographic Info

Paper provided by University of Pretoria, Department of Economics in its series Working Papers with number 200703.

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Length: 25 pages
Date of creation: Feb 2007
Date of revision:
Handle: RePEc:pre:wpaper:200703

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Cited by:
  1. Yen, Steven T. & Yuan, Yan & Liu, Xiaowen, 2009. "Alcohol consumption by men in China: A non-Gaussian censored system approach," China Economic Review, Elsevier, vol. 20(2), pages 162-173, June.
  2. Steven F. Koch & Gauthier Tshiswaka-Kashalala, 2008. "Tobacco Substitution and the Poor," Working Papers 200832, University of Pretoria, Department of Economics.
  3. Ramaele Moshoeshoe, 2012. "Consumer demand for alcoholic beverages and tobacco in Lesotho: A double-hurdle approach," Working Papers 315, Economic Research Southern Africa.
  4. Kolawole Ogundari, 2013. "A Note on Socio-Economic Characteristics and the Demand for Beverages in Nigeria: Does Income Matter?," Economic Analysis and Policy (EAP), Queensland University of Technology (QUT), School of Economics and Finance, vol. 43(3), pages 293-302, December.
  5. Adel Bosch & Steven F. Koch, 2014. "Using a Natural Experiment to Examine Tobacco Tax Regressivity," Working Papers 201424, University of Pretoria, Department of Economics.
  6. Jonathan Meer & Harvey S. Rosen, 2009. "Family Bonding with Universities," NBER Working Papers 15493, National Bureau of Economic Research, Inc.
  7. Ogundari, Kolawole & Arifalo, Sadiat Funmilayo, 0. "Determinants of Household Demand for Fresh Fruit and Vegetable in Nigeria: A Double Hurdle Approach," Quarterly Journal of International Agriculture, Humboldt-Universit├Ąt zu Berlin, vol. 52.

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