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Estimation of individual demand for alcohol

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  • Andrienko Yury

  • Nemtsov Aleksandr

Abstract

Using individual data from RLMS, the longitudinal survey of the representative sample of the Russian population, we study static and dynamic models of demand for alcohol. We show the demand curve has traditional negative slope for any type of alcoholic drink: vodka, beer, and wine. We find substitution of moonshine for vodka with higher price on vodka and between vodka&beer with higher price on one of them. As a result of substitution vodka price has no impact on total ethanol consumption, while higher price on beer and wine reduce demand for ethanol. We also demonstrate that income has important effect on demand for alcoholic drinks. Risk to be drinker is rising with individual income. Higher income results in lower consumption of moonshine and in higher consumption of vodka, beer, and wine.

Suggested Citation

  • Andrienko Yury & Nemtsov Aleksandr, 2005. "Estimation of individual demand for alcohol," EERC Working Paper Series 05-10e, EERC Research Network, Russia and CIS.
    • Handle: RePEc:eer:wpalle:05-10e
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    Cited by:

    1. Evgeny Yakovlev, 2012. "Peers and Alcohol: Evidence from Russia," Working Papers w0182, Center for Economic and Financial Research (CEFIR).
    2. Popov, Vladimir, 2009. "Mortality Crisis in Russia Revisited: Evidence from Cross-Regional Comparison," MPRA Paper 21311, University Library of Munich, Germany, revised Dec 2009.
    3. Alexander S. Skorobogatov, 2014. "The Effect Of Closing Hour Restrictions On Alcohol Use And Abuse In Russia," HSE Working papers WP BRP 63/EC/2014, National Research University Higher School of Economics.
    4. Evgeny Yakovlev, 2016. "Demand for Alcohol Consumption and Implication for Mortality: Evidence from Russia," Working Papers w0221, Center for Economic and Financial Research (CEFIR).
    5. Radaev, Vadim V. (Радаев, Вадим) & Kotelnikova, Zoya V. (Котельникова, Зоя), 2016. "Changes in Alcohol Consumption and Governmental Alcohol Policy in Russia [Изменение Структуры Потребления Алкоголя В Контексте Государственной Алкогольной Политики В России]," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 5, pages 92-117, October.
    6. Yevgeniy Goryakin & Bayard Roberts & Martin McKee, 2015. "Price elasticities of alcohol demand: evidence from Russia," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 16(2), pages 185-199, March.
    7. Yana Roshchina, 2013. "To drink or not to drink: the microeconomic analysis of alcohol consumption in Russia in 2006-2010," HSE Working papers WP BRP 20/SOC/2013, National Research University Higher School of Economics.

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    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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