Abstract:
This paper estimates the effect of minimum retail price policy imposed on vodka and other hard liquor on the consumption of five alcoholic beverages: beer, dry wine, fortified wine, moonshine, and vodka. Using the OLS with community fixed effect, it was found that men increased the consumption of fortified wine by 4.94 percent and it could become an alternative to beverages that became more expensive after the policy implementation. Moreover, the effect of policy differs across age groups and sample restriction.
In overall, policy increased the consumption of alcoholic beverages with lower alcohol content but failed to decrease the consumption of vodka, which was its primary goal.
Submission guide