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Long-Run Effects of Public Policies: Endogenous Alcohol Preferences and Life Expectancy in Russia

Author

Listed:
  • Lorenz Kueng

    () (Northwestern University's Kellogg School of Management, and National Bureau of Economic Research)

  • Evgeny Yakovlev

    () (New Economic School)

Abstract

We use two quasi-natural experiments in the 1980s and 1990s to identify how public policies affect important long-run outcomes by changing preferences. Large but short-lived shocks to product availability in Russia shifted young consumers' long-run preferences from hard to light alcohol. The resulting large cohort differences in current alcohol consumption shares decades after the interventions ended explain about 60% of the recent decrease in male mortality based on both micro-level and aggregate estimates. Mortality will continue to decrease by another 23% over the next twenty years based on our analysis. Program impact evaluations that focus only on contemporaneous effects can therefore severely underestimate the total effect of such public policies.

Suggested Citation

  • Lorenz Kueng & Evgeny Yakovlev, 2016. "Long-Run Effects of Public Policies: Endogenous Alcohol Preferences and Life Expectancy in Russia," Working Papers w0219, Center for Economic and Financial Research (CEFIR).
  • Handle: RePEc:cfr:cefirw:w0219
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    File URL: http://www.cefir.ru/papers/WP219.pdf
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    References listed on IDEAS

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    Cited by:

    1. Dragone, Davide & Ziebarth, Nicolas R., 2017. "Non-separable time preferences, novelty consumption and body weight: Theory and evidence from the East German transition to capitalism," Journal of Health Economics, Elsevier, vol. 51(C), pages 41-65.

    More about this item

    Keywords

    long-run policy effects; endogenous preferences; mortality;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • I10 - Health, Education, and Welfare - - Health - - - General

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