Would a rational underage binge-drink?
AbstractThis paper provides a utility-based definition of binge drinking and examines the compatibility of this phenomenon with rational decision making. Prohibition of young people’s consumption of alcohol is frequently violated with binge-drinking in groups. The analysis considers the roles of peer-pressure, full price of alcohol and crowding in underage group-drinking sessions and identifies the conditions for binge-drinking by expected utility maximizing members. Rational binge-drinking occurs when the impact of the peer-pressure on the individual member’s utility exceeds the loss of utility from the forgone spending on all other goods associated with the expected full marginal cost of consuming alcohol.
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Bibliographic InfoPaper provided by School of Economics, University of Wollongong, NSW, Australia in its series Economics Working Papers with number wp13-03.
Length: 23 pages
Date of creation: 2013
Date of revision:
Contact details of provider:
Postal: School of Economics, University of Wollongong, Northfields Avenue, Wollongong NSW 2522 Australia
Phone: +612 4221-3659
Fax: +612 4221-3725
Web page: http://business.uow.edu.au/econ/index.html
More information through EDIRC
Alcohol; Minimum Age; Peer Pressure; Rationality; Binge Drinking;
Find related papers by JEL classification:
- D1 - Microeconomics - - Household Behavior
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-10-02 (All new papers)
- NEP-HEA-2013-10-02 (Health Economics)
- NEP-UPT-2013-10-02 (Utility Models & Prospect Theory)
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