IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v16y2007i4p407-419.html
   My bibliography  Save this article

The economic cost of teen drinking: late graduation and lowered earnings

Author

Listed:
  • Francesco Renna

Abstract

This paper analyzes the effect that binge drinking has on the probability of graduating on time from high school and on future earnings. The analysis is conducted on students in their senior year of high school using data from the National Longitudinal Survey of Youth 1979. Importantly, the usual instruments used to correct for the endogeneity of the drinking variable are found to be robust only for women. This paper finds that heavy drinking decreases the probability of graduating on time. Binge drinking does not have a direct impact on adults' labor earnings, but graduating late results in lower labor income. Because of a late graduation, young men who binge in high school will face an earnings penalty of 1.5–1.84 percentage points. Women also face a penalty, but this seems mostly due to the fact that women who graduate late work in industries and occupations that pay less. Copyright © 2006 John Wiley & Sons, Ltd.

Suggested Citation

  • Francesco Renna, 2007. "The economic cost of teen drinking: late graduation and lowered earnings," Health Economics, John Wiley & Sons, Ltd., vol. 16(4), pages 407-419, April.
    • Handle: RePEc:wly:hlthec:v:16:y:2007:i:4:p:407-419
    DOI: 10.1002/hec.1178
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.1178
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.1178?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," NBER Chapters, in: Investment in Human Beings, pages 9-49, National Bureau of Economic Research, Inc.
    2. Pinka Chatterji & Jeff DeSimone, 2005. "Adolescent Drinking and High School Dropout," NBER Working Papers 11337, National Bureau of Economic Research, Inc.
    3. Crum, R.M. & Helzer, J.E. & Anthony, J.C., 1993. "Level of education and alcohol abuse and dependence in adulthood: A further inquiry," American Journal of Public Health, American Public Health Association, vol. 83(6), pages 830-837.
    4. Jenny Williams & Lisa Powell & Henry Wechsler, 2003. "Does alcohol consumption reduce human capital accumulation? Evidence from the College Alcohol Study," Applied Economics, Taylor & Francis Journals, vol. 35(10), pages 1227-1239.
    5. 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;Population Association of America (PAA), vol. 32(1), pages 111-131, February.
    6. SF Koch & DC Ribar, 2001. "A Siblings Analysis Of The Effects Of Alcohol Consumption Onset On Educational Attainment," Contemporary Economic Policy, Western Economic Association International, vol. 19(2), pages 162-174, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ji Yan & Sally Brocksen, 2013. "Adolescent risk perception, substance use, and educational attainment," Journal of Risk Research, Taylor & Francis Journals, vol. 16(8), pages 1037-1055, September.
    2. Robert Metcalfe & Simon Burgess and Steven Proud, 2011. "Student effort and educational attainment: Using the England football team to identify the education production function," Economics Series Working Papers 586, University of Oxford, Department of Economics.
    3. 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, February.
    4. Nelson, Jon P., 2014. "Binge Drinking, Alcohol Prices, And Alcohol Taxes," Working Papers 164652, American Association of Wine Economists.
    5. Marlon P. Mundt & Michael T. French, 2013. "Adolescent alcohol use, sociability and income as a young adult," Applied Economics, Taylor & Francis Journals, vol. 45(23), pages 3329-3339, August.
    6. Viinikainen, Jutta & Bryson, Alex & Böckerman, Petri & Kari, Jaana T. & Lehtimäki, Terho & Raitakari, Olli & Viikari, Jorma & Pehkonen, Jaakko, 2022. "Does better education mitigate risky health behavior? A mendelian randomization study," Economics & Human Biology, Elsevier, vol. 46(C).
    7. Karel JANDA & Jakub MIKOLÁŠEK & Martin NETUKA, 2010. "Complete almost ideal demand system approach to the Czech alcohol demand," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 56(9), pages 421-434.
    8. Balsa, Ana I. & Giuliano, Laura M. & French, Michael T., 2011. "The effects of alcohol use on academic achievement in high school," Economics of Education Review, Elsevier, vol. 30(1), pages 1-15, February.
    9. Cuffe, Harold E. & Gibbs, Christopher G., 2017. "The effect of payday lending restrictions on liquor sales," Journal of Banking & Finance, Elsevier, vol. 85(C), pages 132-145.
    10. Mangiavacchi, Lucia & Piccoli, Luca, 2018. "Parental alcohol consumption and adult children's educational attainment," Economics & Human Biology, Elsevier, vol. 28(C), pages 132-145.
    11. Cowan, Benjamin W., 2011. "Forward-thinking teens: The effects of college costs on adolescent risky behavior," Economics of Education Review, Elsevier, vol. 30(5), pages 813-825, October.
    12. Adams, Scott J. & Heywood, John S. & Ullman, Darin F. & Venkatesh, Shrathinth, 2022. "Social jobs and the returns to drinking," Economics & Human Biology, Elsevier, vol. 46(C).
    13. Cuffe, Harold E. & Gibbs, Christopher G., 2017. "The effect of payday lending restrictions on liquor sales," Journal of Banking & Finance, Elsevier, vol. 85(C), pages 132-145.
    14. Ou Yang & Xueyan Zhao & Preety Srivastava, 2016. "Binge Drinking and Antisocial and Unlawful Behaviours in Australia," The Economic Record, The Economic Society of Australia, vol. 92(297), pages 222-240, June.
    15. John Cawley & Johanna Catherine Maclean, 2012. "Unfit For Service: The Implications Of Rising Obesity For Us Military Recruitment," Health Economics, John Wiley & Sons, Ltd., vol. 21(11), pages 1348-1366, November.
    16. Jenny Lye & Joe Hirschberg, 2010. "Alcohol Consumption And Human Capital: A Retrospective Study Of The Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 24(2), pages 309-338, April.
    17. Jeremy W. Bray & Jesse M. Hinde & Arnie P. Aldridge, 2018. "Alcohol use and the wage returns to education and work experience," Health Economics, John Wiley & Sons, Ltd., vol. 27(2), pages 87-100, February.
    18. Jon Nelson, 2015. "Binge drinking and alcohol prices: a systematic review of age-related results from econometric studies, natural experiments and field studies," Health Economics Review, Springer, vol. 5(1), pages 1-13, December.
    19. Sabia, Joseph J. & Rees, Daniel I., 2011. "Individual heterogeneity and reverse causality in the relationship between migraine headache and educational attainment," Economics of Education Review, Elsevier, vol. 30(5), pages 913-923, October.
    20. Waddell, Glen R., 2010. "Gender and the Influence of Peer Alcohol Consumption on Adolescent Sexual Activity," IZA Discussion Papers 4880, Institute of Labor Economics (IZA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Renna, Francesco, 2008. "Teens' alcohol consumption and schooling," Economics of Education Review, Elsevier, vol. 27(1), pages 69-78, February.
    2. Joseph J. Sabia, 2010. "Wastin’ Away In Margaritaville? New Evidence On The Academic Effects Of Teenage Binge Drinking," Contemporary Economic Policy, Western Economic Association International, vol. 28(1), pages 1-22, January.
    3. 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, February.
    4. Pinka Chatterji & Jeffrey DeSimone, 2006. "High School Alcohol Use and Young Adult Labor Market Outcomes," NBER Working Papers 12529, National Bureau of Economic Research, Inc.
    5. Jeff DeSimone, 2010. "Drinking and academic performance in high school," Applied Economics, Taylor & Francis Journals, vol. 42(12), pages 1481-1497.
    6. Pinka Chatterji & Jeff DeSimone, 2005. "Adolescent Drinking and High School Dropout," NBER Working Papers 11337, National Bureau of Economic Research, Inc.
    7. Pinka Chatterji, 2006. "Illicit drug use and educational attainment," Health Economics, John Wiley & Sons, Ltd., vol. 15(5), pages 489-511, May.
    8. Mause Karsten, 2008. "Ist Bildung eine Ware? Ein Klärungsversuch / Is Education a Market Good? An Attempt to Clarify," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 59(1), pages 363-380, January.
    9. Adams, Scott J. & Heywood, John S. & Ullman, Darin F. & Venkatesh, Shrathinth, 2022. "Social jobs and the returns to drinking," Economics & Human Biology, Elsevier, vol. 46(C).
    10. Ana I. Balsa, 2008. "Parental Problem-drinking and Adult Children’s Labor Market Outcomes," Journal of Human Resources, University of Wisconsin Press, vol. 43(2), pages 454-486.
    11. Amy M. Wolaver, 2007. "Does Drinking Affect Grades More for Women? Gender Differences in the Effects of Heavy Episodic Drinking in College," The American Economist, Sage Publications, vol. 51(2), pages 72-88, October.
    12. Jeremy W. Bray & Jesse M. Hinde & Arnie P. Aldridge, 2018. "Alcohol use and the wage returns to education and work experience," Health Economics, John Wiley & Sons, Ltd., vol. 27(2), pages 87-100, February.
    13. Chatterji, Pinka, 2006. "Does alcohol use during high school affect educational attainment?: Evidence from the National Education Longitudinal Study," Economics of Education Review, Elsevier, vol. 25(5), pages 482-497, October.
    14. Balsa, Ana I. & Giuliano, Laura M. & French, Michael T., 2011. "The effects of alcohol use on academic achievement in high school," Economics of Education Review, Elsevier, vol. 30(1), pages 1-15, February.
    15. Michael T. French & Johanna C. Maclean, 2006. "Underage alcohol use, delinquency, and criminal activity," Health Economics, John Wiley & Sons, Ltd., vol. 15(12), pages 1261-1281, December.
    16. Jenny Lye & Joe Hirschberg, 2010. "Alcohol Consumption And Human Capital: A Retrospective Study Of The Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 24(2), pages 309-338, April.
    17. Donata Bessey & Uschi Backes-Gellner, 2009. "Marijuana Consumption, Educational Outcomes and Labor Market Success: Evidence from Switzerland," Economics of Education Working Paper Series 0043, University of Zurich, Department of Business Administration (IBW).
    18. Prof. Dr. Adem KALCA & Resc. Assist. Atakan DURMAZ, 2012. "Diaspora As The Instrument Of Humane Capital," International Journal of Business and Social Research, LAR Center Press, vol. 2(5), pages 94-104, October.
    19. María Fernanda Páramo & Fernando Cadaveira & Carolina Tinajero & María Soledad Rodríguez, 2020. "Binge Drinking, Cannabis Co-Consumption and Academic Achievement in First Year University Students in Spain: Academic Adjustment as a Mediator," IJERPH, MDPI, vol. 17(2), pages 1-14, January.
    20. Dimitris Pavlopoulos & Ruud Muffels & Jeroen K. Vermunt, 2009. "Training and Low‐pay Mobility: The Case of the UK and the Netherlands," LABOUR, CEIS, vol. 23(s1), pages 37-59, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:16:y:2007:i:4:p:407-419. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.