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Broadcast Advertising and U.S. Demand for Alcoholic Beverages

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  • Jon P. Nelson

Abstract

Quarterly data for 1977–1994 on alcohol consumption and advertising are used to estimate a differential demand system, including explanatory variables for broadcast advertising and print advertising. The model explains the growth rate of per capita consumption dependent on explanatory variables for prices, real income, demographic changes, and real advertising by media and beverage. Empirical results also are reported for total consumption of pure alcohol. The results for the three beverages and total alcohol indicate that advertising has little or no effect on demand. The empirical evidence thus supports the notion that regardless of media, advertising affects mainly brand shares.

Suggested Citation

  • Jon P. Nelson, 1999. "Broadcast Advertising and U.S. Demand for Alcoholic Beverages," Southern Economic Journal, Southern Economic Association, vol. 65(4), pages 774-790, April.
  • Handle: RePEc:sej:ancoec:v:65:4:y:1999:p:774-790
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    Cited by:

    1. Saroja Selvanathan & Eliyathamby Selvanathan, 2007. "Another look at the identical tastes hypothesis on the analysis of cross-country alcohol data," Empirical Economics, Springer, vol. 32(1), pages 185-215, April.
    2. Gallet, Craig A., 2007. "The demand for alcohol: a meta-analysis of elasticities," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 51(2), June.
    3. Hamilton, Stephen F., 2009. "Informative advertising in differentiated oligopoly markets," International Journal of Industrial Organization, Elsevier, vol. 27(1), pages 60-69, January.
    4. Dyack, Brenda & Goddard, Ellen W., 2001. "The Rise of Red and the Wane of White: Wine Demand in Ontario Canada," 2001 Conference (45th), January 23-25, 2001, Adelaide 125617, Australian Agricultural and Resource Economics Society.
    5. Henry Saffer & Dhaval Dave, 2002. "Alcohol consumption and alcohol advertising bans," Applied Economics, Taylor & Francis Journals, vol. 34(11), pages 1325-1334.
    6. repec:eee:irlaec:v:50:y:2017:i:c:p:15-24 is not listed on IDEAS
    7. Tanja Greiner & Marco Sahm, 2011. "How Effective are Advertising Bans? On the Demand for Quality in Two-Sided Media Markets," CESifo Working Paper Series 3524, CESifo Group Munich.
    8. Jeffrey D. Kubik & John R. Moran, 2001. "Can Policy Changes Be Treated as Natural Experiments? Evidence from State Excise Taxes," Center for Policy Research Working Papers 39, Center for Policy Research, Maxwell School, Syracuse University.
    9. Henry Saffer & Dhaval Dave, 2006. "Alcohol advertising and alcohol consumption by adolescents," Health Economics, John Wiley & Sons, Ltd., vol. 15(6), pages 617-637.
    10. Toro-Gonzalez, Daniel & McCluskey, Jill J. & Mittelhammer, Ron, 2014. "Beer Snobs Do Exist: Estimation of Beer Demand by Type," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 39(2), August.
    11. Hamilton, Stephen F., 2004. "Informative Advertising in Concentrated, Differentiated Markets," Working Papers 201546, University of Wisconsin-Madison, Department of Agricultural and Applied Economics, Food System Research Group.
    12. Adrian R. Fleissig, 2016. "Changing Trends in U.S. Alcohol Demand," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 44(3), pages 263-276, September.
    13. Thompson, Stanley R. & Sam, Abdoul G., 2008. "Country of Origin Advertising and U.S. Wine Imports," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6553, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    14. Rojas, Christian & Peterson, Everett B., 2008. "Demand for differentiated products: Price and advertising evidence from the U.S. beer market," International Journal of Industrial Organization, Elsevier, vol. 26(1), pages 288-307, January.
    15. NEWAJ Avinash & DAMAR-LADKOO Adjnu, 2016. "Distorted Facets Of Marketing Ethics For Alcoholic Beer Marketing," Studies in Business and Economics, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 11(2), pages 79-96, August.
    16. Rojas, Christian & Peterson, Everett, 2005. "Estimating Demand for Differentiated Products: The Case of Beer in the U.S," Research Reports 149023, University of Connecticut, Food Marketing Policy Center.
    17. Sahm, Marco & Greiner, Tanja, 2016. "How Effective Are Advertising Bans? On the Demand for Quality in Two-Sided Media Markets," Annual Conference 2016 (Augsburg): Demographic Change 145724, Verein für Socialpolitik / German Economic Association.
    18. Nelson, Jon P. & Young, Douglas J., 2001. "Do Advertising Bans Work? An International Comparison," Working Papers 6-01-1, Pennsylvania State University, Department of Economics.
    19. Victor J. Tremblay & Kumiko Okuyama, 2001. "Advertising Restrictions, Competition, And Alcohol Consumption," Contemporary Economic Policy, Western Economic Association International, vol. 19(3), pages 313-321, July.
    20. Duffy, Martyn, 2003. "On the estimation of an advertising-augmented, cointegrating demand system," Economic Modelling, Elsevier, vol. 20(1), pages 181-206, January.
    21. Nelson, Jon P., 2001. "Alcohol Advertising and Advertising Bans: A Survey of Research Methods, Results, and Policy Implications," Working Papers 7-01-2, Pennsylvania State University, Department of Economics.
    22. Jon Nelson, 2003. "Advertising Bans, Monopoly, and Alcohol Demand: Testing for Substitution Effects using State Panel Data," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 22(1), pages 1-25, February.

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