Investigating the volume and structure of alcohol consumption in Russian regions

Purpose - The purpose of this paper is to examine macroeconomic factors that are significantly related to consumption of various alcoholic beverages in Russia. Design/methodology/approach - The authors consider 78 Russian regions for the period from 2008 to 2012. Data were collected from the Federal State Statistics Service of Russia. The authors investigate differences in the volume and structure of consuming absolute alcohol in aggregate, vodka, beer, and wine. Estimating fixed effect panel models enables us to reveal the relationship between alcohol consumption and the set of macroeconomic factors that include economic development of regions and living standards, the effect of unemployment, and the degree of urbanization. Findings - Alcohol consumption is procyclical in Russia. Two main alcoholic beverages in Russia are vodka and beer. Economic development and urbanization of regions are positively related to consuming alcohol. Unemployment rate affects consumption of different types of alcoholic drinks in a different way. For absolute alcohol, vodka and beer, this relationship is negative. However, it is positive for wine. The effect of unemployment on absolute alcohol and vodka increases over time. For beer, it is remained unchanged. For wine, this effect weakens over time. Originality/value - To the authors knowledge, the paper is the first one to analyze macro-level factors of consumption of different alcoholic beverages in Russia. Conclusions made on aggregate macroeconomic data add to understanding of drinking patterns in Russia as a country with the large territory and great regional variations. Findings can be used for correcting the alcohol policy at the national and regional level.