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The impact of problem drinking on employment

  • Weiwei Feng

    (Corning Incorporated, Corning, NY, USA)

  • Wei Zhou

    (Corning Incorporated, Corning, NY, USA)

  • J.S. Butler

    (Department of Policy Analysis and Management, Cornell University, USA)

  • Brenda M. Booth

    (Department of Psychiatry, University of Arkansas for Medical Sciences (UAMS), USA)

  • Michael T. French

    (Health Services Research Center, Department of Epidemiology and Public Health and Department of Economics, University of Miami, USA)

Social cost studies report that alcohol use and misuse impose a great economic burden on society, and over half of the total economic costs are estimated to be due to the loss of work productivity. Controversy remains, however, as to the magnitude and direction of the effects of alcohol consumption on productivity. Furthermore, most of the studies have looked at the relationship between problem drinking and wages. This paper investigates the impact of problem drinking on employment by analysing a random sample of men and women of prime working age from six Southern states in the US (Alabama, Arkansas, Georgia, Louisiana, Mississippi and Tennessee). The data set contains 4898 females and 3224 males, with information on both employment and problem drinking. To eliminate the bias that may result from single-equation estimation, we used a bivariate probit model to control for possible correlation in the unobservable factors that affect both problem drinking and employment. We find no significant negative association between problem drinking and employment for both men and women, controlling for other covariates. The findings are consistent with other research and highlight several methodological issues. Furthermore, the study suggests that estimates of the costs of problem drinking may be overstated owing to misleading labour supply relationships. Copyright © 2001 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/hec.611
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Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 10 (2001)
Issue (Month): 6 ()
Pages: 509-521

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Handle: RePEc:wly:hlthec:v:10:y:2001:i:6:p:509-521
Contact details of provider: Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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  1. Zarkin, Gary A. & French, Michael T. & Mroz, Thomas & Bray, Jeremy W., 1998. "Alcohol use and wages: New results from the national household survey on drug abuse," Journal of Health Economics, Elsevier, vol. 17(1), pages 53-68, January.
  2. Ribar, David C, 1994. "Teenage Fertility and High School Completion," The Review of Economics and Statistics, MIT Press, vol. 76(3), pages 413-24, August.
  3. Hugh R. Waters, 1999. "Measuring the impact of health insurance with a correction for selection bias-a case study of Ecuador," Health Economics, John Wiley & Sons, Ltd., vol. 8(5), pages 473-483.
  4. Charles A. Register & Donald R. Williams, 1992. "Labor market effects of marijuana and cocaine use among young men," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 45(3), pages 435-451, April.
  5. Andrew M. Gill & Robert J. Michaels, 1992. "Does drug use lower wages?," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 45(3), pages 419-434, April.
  6. French, Michael T. & Zarkin, Gary A., 1995. "Is moderate alcohol use related to wages? Evidence from four worksites," Journal of Health Economics, Elsevier, vol. 14(3), pages 319-344, August.
  7. Mullahy, John & Sindelar, Jody L, 1991. "Gender Differences in Labor Market Effects of Alcoholism," American Economic Review, American Economic Association, vol. 81(2), pages 161-65, May.
  8. Kenneth Bollen & David Guilkey & Thomas Mroz, 1995. "Binary outcomes and endogenous explanatory variables: Tests and solutions with an application to the demand for contraceptive use in tunisia," Demography, Springer, vol. 32(1), pages 111-131, February.
  9. Gail Mitchell Hoyt & Frank J. Chaloupka, 1994. "Effect Of Survey Conditions On Self-Reported Substance Use," Contemporary Economic Policy, Western Economic Association International, vol. 12(3), pages 109-121, 07.
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