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The early impact of Scotland's minimum unit pricing policy on alcohol prices and sales

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  • Irena Palamani Xhurxhi

Abstract

In May 2018, Scotland became the first country in the world to enforce a minimum unit pricing (MUP) of 50 pence ($0.65; €0.55) on alcoholic beverages as a measure to control alcohol consumption and alcohol‐related harms. This study presents early estimates of the impact of MUP on three outcomes: average price per unit (8 gr/10 ml) of alcohol, liters of alcohol sold per adult, and liters of alcohol sold per adult drinker, in three different settings: off‐premise, on‐premise, and both combined. Using yearly alcohol price and sales data from 2011 to 2019, I find that the average price per unit of alcohol has significantly risen post‐MUP across all beverage categories (beer, spirits, wine, cider, and alcohol‐all types), whereas liters of alcohol sold per adult and per adult drinker have significantly reduced for beer, spirits, cider, and alcohol‐all types. For all outcomes, the impact of MUP on off‐premise alcohol prices and sales is more pronounced than under the combined case, while no significant effects are found on‐premise. These results are robust to model specification and to the addition of various control variables. Falsification tests changing the timing of the policy were performed and no significant results were found.

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  • Irena Palamani Xhurxhi, 2020. "The early impact of Scotland's minimum unit pricing policy on alcohol prices and sales," Health Economics, John Wiley & Sons, Ltd., vol. 29(12), pages 1637-1656, December.
    • Handle: RePEc:wly:hlthec:v:29:y:2020:i:12:p:1637-1656
    DOI: 10.1002/hec.4156
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    1. Chris Sampson’s journal round-up for 7th December 2020
      by Chris Sampson in The Academic Health Economists' Blog on 2020-12-07 12:00:03

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    2. Farasat A. S. Bokhari & Ratula Chakraborty & Paul W. Dobson & Marcello Morciano, 2024. "Lockdown drinking: The sobering effect of price controls in a pandemic," Economic Inquiry, Western Economic Association International, vol. 62(4), pages 1539-1557, October.
    3. Bokhari, Farasat A.S. & Dobson, Paul W. & Morciano, Marcello & Suhrcke, Marc, 2023. "Banning volume discounts to curb excessive consumption: A cautionary tale," European Economic Review, Elsevier, vol. 156(C).

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