The demand for alcohol: The differential response to price

Willard G. Manning, Linda Blumberg, Lawrence H. Moulton

Research output: Contribution to journalArticle

Abstract

Although several studies indicate that drinking is responsive to price, little work has focused on whether prices have a differential effect on light, moderate, or heavy drinking. This study examines the price responsiveness of the demand for alcohol: whether heavy drinkers are less sensitive to price than light or moderate drinkers. The study uses data on alcohol consumption on the 1983 National Health Interview Survey. The results indicate that both light and heavy drinkers are much less price elastic than moderate drinkers. Further, we cannot reject the hypothesis that the very heaviest drinkers have perfectly price inelastic demands.

Original languageEnglish (US)
Pages (from-to)123-148
Number of pages26
JournalJournal of health economics
Volume14
Issue number2
DOIs
StatePublished - Jun 1995

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Keywords

  • Alcohol
  • Demand
  • Price elasticity of demand
  • Quantile regression

ASJC Scopus subject areas

  • Health Policy
  • Public Health, Environmental and Occupational Health

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