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Rational Alcohol Addiction: Evidence from the Russian Longitudinal Monitoring Survey

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Abstract

Alcohol consumption in Russia is legendary and has been reported to be the third leading cause of death in the former Soviet Union after heart disease and cancer. Are Russian alcohol consumers rational addicts? This paper uses eight rounds of a nationally representative Russian survey spanning the period 1994-2003 to estimate a rational addiction (RA) model for alcohol consumption. This is done in a panel data setting as well as on a wave by wave basis. Theprofile of the Russian drinker finds a huge difference between males and females and the model is estimated by gender. We do not find support for the RA model in Russia for women. For men, although we find that some implications of the RA model are satisfied, we fail to endore the model impirically on grounds of implausible negative estimates of the discount rate.

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  • Badi H. Baltagi & Ingo Geishecker, 2006. "Rational Alcohol Addiction: Evidence from the Russian Longitudinal Monitoring Survey," Center for Policy Research Working Papers 81, Center for Policy Research, Maxwell School, Syracuse University.
  • Handle: RePEc:max:cprwps:81
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    Cited by:

    1. Laporte A & Karimova A & Ferguson B, 2009. "Quantile Regression Analysis of the Rational Addiction Model: Making unobservable heterogeneity observable," Health, Econometrics and Data Group (HEDG) Working Papers 09/18, HEDG, c/o Department of Economics, University of York.
    2. Luca Bossi & Pedro Gomis-Porqueras & David L. Kelly, 2007. "Optimal Second Best Taxation of Addictive Goods," Working Papers 0708, University of Miami, Department of Economics.
    3. David Aristei & Luca Pieroni, 2010. "Habits, Complementarities and Heterogeneity in Alcohol and Tobacco Demand: A Multivariate Dynamic Model," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 72(4), pages 428-457, August.
    4. Pierani, P.; Tiezzi, S.;, 2017. "Rational addiction and time consistency:an empirical test," Health, Econometrics and Data Group (HEDG) Working Papers 17/05, HEDG, c/o Department of Economics, University of York.
    5. Linz, Susan J. & Semykina, Anastasia, 2010. "Perceptions of economic insecurity: Evidence from Russia," Economic Systems, Elsevier, vol. 34(4), pages 357-385, December.
    6. Herzfeld, Thomas & Huffman, Sonya & Rizov, Marian, 2014. "The dynamics of food, alcohol and cigarette consumption in Russia during transition," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 128-143.
    7. Yormirzoev Mirzobobo & Gabrielyan Gnel, 2016. "Factors Associated with Alcoholic Beverages Consumption in Russia: A Discrete Choice Model," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 14(1), pages 133-139, May.
    8. 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.
    9. Irina Denisova, 2009. "Mortality in Russia: Microanalysis," Working Papers w0128, Center for Economic and Financial Research (CEFIR).
    10. 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).
    11. Daniel Treisman, 2010. "Death and prices," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 18(2), pages 281-331, April.
    12. Herzfeld, Thomas & Huffman, Sonya Kostova & Oskam, Arie J. & Rizov, Marian, 2009. "Changes in Food, Alcohol and Cigarettes Consumption during Transition: Evidence from Russia," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49239, Agricultural and Applied Economics Association.
    13. Staudigel, Matthias, 2011. "How (much) do food prices contribute to obesity in Russia?," Economics & Human Biology, Elsevier, vol. 9(2), pages 133-147, March.
    14. 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.
    15. Herzfeld, Thomas & Huffman, Sonya K. & Rizov, Marian, 2009. "The Dynamics of the Russian Lifestyle During Transition: Changes in Food, Alcohol and Cigarette Consumption," Staff General Research Papers Archive 13116, Iowa State University, Department of Economics.
    16. Bossi Luca & Gomis-Porqueras Pedro & Kelly David L., 2014. "Optimal second best taxation of addictive goods in dynamic general equilibrium: a revenue raising perspective," The B.E. Journal of Macroeconomics, De Gruyter, vol. 14(1), pages 1-44, January.
    17. Deconinck, Koen & Swinnen, Johan, 2015. "Peer effects and the rise of beer in Russia," Food Policy, Elsevier, vol. 51(C), pages 83-96.
    18. Martin Bassols, Nicolau & Vall Castelló, Judit, 2016. "Effects of the great recession on drugs consumption in Spain," Economics & Human Biology, Elsevier, vol. 22(C), pages 103-116.

    More about this item

    Keywords

    panel data; liquor consumption; rational addiction;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • I10 - Health, Education, and Welfare - - Health - - - General

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