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Binge Drinking and Labor Market Success: A Longitudinal Study on Young People

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  • Keng, Shao-Hsun
  • Huffman, Wallace

Abstract

This paper presents a two equation model of joint outcomes on an individualï¾’s decision to binge drink and on his/her annual labor market earnings. The primary data source is the 1979 cohort of the National Longitudinal Survey of Youth (NLSY79), 19791994. We show that binge drinking behavior is quite alcoholprice responsive and is a rational addiction. A new result is that an individualï¾’s decision to binge drink has a statistically significant negative effect on his/her earnings. Furthermore, we conducted simulations of the shortrun and longrun impacts of increasing the alcohol price. They showed that that the tendency for an individual to binge drink heavily is reduced significantly, and the reduction is greater in the long than shortrun simulation. Also, an individualï¾’s annual earnings were increased. However, in the structural model, an individualï¾’s earnings have no significant effect on his/her tendency to engage in binge drinking. Our results contradict earlier findings from crosssection evidence that showed increased alcohol consumption raised an individualï¾’s earnings or wages.

Suggested Citation

  • Keng, Shao-Hsun & Huffman, Wallace, 2005. "Binge Drinking and Labor Market Success: A Longitudinal Study on Young People," Staff General Research Papers Archive 12299, Iowa State University, Department of Economics.
  • Handle: RePEc:isu:genres:12299
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    Cited by:

    1. Shao-Hsun Keng & Sheng-Jang Sheu, 2013. "The effect of stimulants and their combined use with cigarettes on mortality: the case of betel quid," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(4), pages 677-695, August.
    2. Nelson, Jon P., 2014. "Binge Drinking, Alcohol Prices, And Alcohol Taxes," Working Papers 164652, American Association of Wine Economists.
    3. Huang, Ying & Huffman, Wallace, 2013. "Forward Looking Decision Making: The Effects of the Food Stamp Program Participation on Women’s Obesity in the NLSY," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150264, Agricultural and Applied Economics Association.
    4. Huffman, Wallace, 2009. "Investing in People for the 21st Century," Staff General Research Papers Archive 13127, Iowa State University, Department of Economics.
    5. Ceren Ertan Yörük & Barış Yörük, 2015. "Alcohol consumption and risky sexual behavior among young adults: evidence from minimum legal drinking age laws," Journal of Population Economics, Springer;European Society for Population Economics, vol. 28(1), pages 133-157, January.
    6. Barnes, Andrew J. & Zimmerman, Frederick J., 2013. "Associations of occupational attributes and excessive drinking," Social Science & Medicine, Elsevier, vol. 92(C), pages 35-42.
    7. Cardoso, Ana Rute & Verner, Dorte, 2007. "Youth Risk-Taking Behavior in Brazil: Drug Use and Teenage Pregnancies," IZA Discussion Papers 3030, Institute for the Study of Labor (IZA).
    8. 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.
    9. repec:bpj:bejeap:v:17:y:2017:i:3:p:21:n:8 is not listed on IDEAS
    10. Chen, Ying-Ju & Zenou, Yves & Zhou, Junjie, 2015. "Multiple Activities for Socially-Connected Criminals," CEPR Discussion Papers 10709, C.E.P.R. Discussion Papers.
    11. Chen, Zhuo & Huffman, Wallace E. & Rozelle, Scott, 2009. "Farm technology and technical efficiency: Evidence from four regions in China," China Economic Review, Elsevier, vol. 20(2), pages 153-161, June.
    12. Anindya Sen & May Luong, 2008. "Estimating The Impact Of Beer Prices On The Incidence Of Sexually Transmitted Diseases: Cross-Province And Time Series Evidence From Canada," Contemporary Economic Policy, Western Economic Association International, vol. 26(4), pages 505-517, October.
    13. Huang, Ying, 2012. "an econometric study of the impact of economic variables on adult obesity and food assistance program participation in the NLSY panel," ISU General Staff Papers 201201010800003717, Iowa State University, Department of Economics.
    14. Yörük Barış K., 2017. "Health Insurance Coverage and Risky Health Behaviors among Young Adults," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 17(3), pages 1-21, July.
    15. Jason Fletcher, 2012. "Peer influences on adolescent alcohol consumption: evidence using an instrumental variables/fixed effect approach," Journal of Population Economics, Springer;European Society for Population Economics, vol. 25(4), pages 1265-1286, October.
    16. Grant, Darren, 2016. "A structural analysis of U.S. drunk driving policy," International Review of Law and Economics, Elsevier, vol. 45(C), pages 14-22.

    More about this item

    JEL classification:

    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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