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What happens to drinking when alcohol policy changes? A review of five natural experiments for alcohol taxes, prices, and availability

Listed author(s):
  • Jon P. Nelson

    ()

    (Pennsylvania State University)

  • Amy D. McNall

Abstract Natural experiments are an important alternative to observational and econometric studies. This paper provides a review of results from empirical studies of alcohol policy interventions in five countries: Denmark, Finland, Hong Kong, Sweden, and Switzerland. Major policy changes were removal of quotas on travelers’ tax-free imports and reductions in alcohol taxes. A total of 29 primary articles are reviewed, which contain 35 sets of results for alcohol consumption by various subpopulations and time periods. For each country, the review summarizes and examines: (1) history of tax/quota policy interventions and price changes; (2) graphical trends for alcohol consumption and liver disease mortality; and (3) empirical results for policy effects on alcohol consumption and drinking patterns. We also compare cross-country results for three select outcomes—binge drinking, alcohol consumption by youth and young adults, and heavy consumption by older adults. Overall, we find a lack of consistent results for consumption both within- and across-countries, with a general finding that alcohol tax interventions had selective, rather than broad, impacts on subpopulations and drinking patterns. Policy implications of these findings are discussed.

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File URL: http://link.springer.com/10.1007/s10198-016-0795-0
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Article provided by Springer & Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ) in its journal The European Journal of Health Economics.

Volume (Year): 18 (2017)
Issue (Month): 4 (May)
Pages: 417-434

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Handle: RePEc:spr:eujhec:v:18:y:2017:i:4:d:10.1007_s10198-016-0795-0
DOI: 10.1007/s10198-016-0795-0
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  1. Joshua D. Angrist & Jörn-Steffen Pischke, 2009. "Mostly Harmless Econometrics: An Empiricist's Companion," Economics Books, Princeton University Press, edition 1, number 8769, March.
  2. Dee, Thomas S., 1999. "The complementarity of teen smoking and drinking," Journal of Health Economics, Elsevier, vol. 18(6), pages 769-793, December.
  3. Nelson, Jon P., 2014. "Estimating the price elasticity of beer: Meta-analysis of data with heterogeneity, dependence, and publication bias," Journal of Health Economics, Elsevier, vol. 33(C), pages 180-187.
  4. Cook, Philip J. & Durrance, Christine Piette, 2013. "The virtuous tax: Lifesaving and crime-prevention effects of the 1991 federal alcohol-tax increase," Journal of Health Economics, Elsevier, vol. 32(1), pages 261-267.
  5. Jon Nelson, 2013. "Meta-analysis of alcohol price and income elasticities – with corrections for publication bias," Health Economics Review, Springer, vol. 3(1), pages 1-10, December.
  6. Nelson, Jon P. & McNall, Amy D., 2016. "Alcohol prices, taxes, and alcohol-related harms: A critical review of natural experiments in alcohol policy for nine countries," Health Policy, Elsevier, vol. 120(3), pages 264-272.
  7. Michael T. French & Ioana Popovici, 2011. "That instrument is lousy! In search of agreement when using instrumental variables estimation in substance use research," Health Economics, John Wiley & Sons, Ltd., vol. 20(2), pages 127-146, 02.
  8. Lorenz Kueng & Evgeny Yakovlev, 2014. "How Persistent Are Consumption Habits? Micro-Evidence from Russia," NBER Working Papers 20298, National Bureau of Economic Research, Inc.
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