Heterogenous wealth effects of minimum unit price on purchase of alcohol: Evidence using scanner data

Autoři: Anurag Sharma aff001;  Brian Vandenberg aff002
Působiště autorů: School of Public Health and Community Medicine, University of New South Wales, Sydney, Australia aff001;  School of Social Sciences, Monash University, Australia aff002
Vyšlo v časopise: PLoS ONE 14(12)
Kategorie: Research Article
doi: 10.1371/journal.pone.0225538


One of the key arguments given to oppose the “sin taxes” is that they are regressive in nature and place disproportionately higher cost on the poor thereby reducing their net wealth. The response to a reduction in net wealth attributed to tax can potentially have significant effects through an increase in alcohol purchase by heavy drinkers reinforcing or even offsetting the direct price or substitution effect of these taxes in reducing alcohol consumption. Comparatively little is known empirically about the net wealth effect associated with changes in alcohol tax policy, and this study aims to help fill this gap in the literature. In this study we aim to estimate how the wealth effects of introducing a minimum unit price (MUP) of A$2.00 per standard drink vary over the distribution (quantiles) of alcohol consumers. The data used in this study is a longitudinal panel of 1,395 households’ daily alcohol purchases (scanner data) recorded over a full year. Our analysis involves (i) quantile regression to estimate income elasticity over the distribution of consumption, and (ii) using these elasticities to estimate the potential wealth effects of a hypothetical change in alcohol prices from introducing an MUP policy. We control for consumer demographic characteristics, alcohol product prices and prices of close substitutes, and quarterly seasonal effects. We find that the estimated wealth effect from increasing the price of alcohol under a MUP policy is not significant at any point over the distribution of alcohol consumers. The policy increases per capita tax impact by less than A$5.00 per week for light/moderate consumers (50th—80th quantile) and decreases their daily per capita alcohol consumption by less than 0.02 standard drinks. Wealth effects attributable to an MUP policy are likely to be negligible. Substitution effects of the policy dominate the wealth effects in generating key health related outcomes such as reductions in alcohol consumption.

Klíčová slova:

Alcohol consumption – Alcoholism – Australia – Finance – Public and occupational health – Public policy – Taxation – Taxes


1. Elder RW, Lawrence B, Ferguson A, Naimi TS, Brewer RD, Chattopadhyay SK, et al. The effectiveness of tax policy interventions for reducing excessive alcohol consumption and related harms. American journal of preventive medicine. 2010;38(2):217–229. doi: 10.1016/j.amepre.2009.11.005 20117579

2. Wagenaar AC, Tobler AL, Komro KA. Effects of alcohol tax and price policies on morbidity and mortality: a systematic review. American Journal of Public Health. 2010;100(11):2270–2278. doi: 10.2105/AJPH.2009.186007 20864710

3. Black H, Gill J, Chick J. The price of a drink: levels of consumption and price paid per unit of alcohol by Edinburgh’s ill drinkers with a comparison to wider alcohol sales in Scotland. Addiction. 2011;106(4):729–736. doi: 10.1111/j.1360-0443.2010.03225.x 21134019

4. Callinan S, Room R, Livingston M, Jiang H. Who purchases low-cost alcohol in Australia? Alcohol and Alcoholism. 2015;50(6):647–653. doi: 10.1093/alcalc/agv066 26109263

5. Crawford MJ, Parry AM, Weston AR, Seretis D, Zauter-Tutt M, Hussain A, et al. Relationship between price paid for off-trade alcohol, alcohol consumption and income in England: a cross-sectional survey. Alcohol and alcoholism. 2012;47(6):738–742. doi: 10.1093/alcalc/ags091 22893226

6. Sharma A, Vandenberg B, Hollingsworth B. Minimum pricing of alcohol versus volumetric taxation: which policy will reduce heavy consumption without adversely affecting light and moderate consumers? PLoS One. 2014;9(1):e80936. doi: 10.1371/journal.pone.0080936 24465368

7. Sheron N, Chilcott F, Matthews L, Challoner B, Thomas M. Impact of minimum price per unit of alcohol on patients with liver disease in the UK. Clinical Medicine. 2014;14(4):396–403. doi: 10.7861/clinmedicine.14-4-396 25099842

8. Pryce R, Hollingsworth B, Walker I. Alcohol quantity and quality price elasticities: quantile regression estimates. The European Journal of Health Economics. 2018; p. 1–16.

9. Wagenaar AC, Salois MJ, Komro KA. Effects of beverage alcohol price and tax levels on drinking: a meta-analysis of 1003 estimates from 112 studies. Addiction. 2009;104(2):179–190. doi: 10.1111/j.1360-0443.2008.02438.x 19149811

10. WHO. International Guide for Monitoring Alcohol and Related Harm; 2000. http://whqlibdoc.who.int/hq/2000/who_msd_msb_00.4.pdf.

11. Gallet CA. The demand for alcohol: a meta-analysis of elasticities. Australian Journal of Agricultural and Resource Economics. 2007;51(2):121–135. doi: 10.1111/j.1467-8489.2007.00365.x

12. Daley JI, Stahre MA, Chaloupka FJ, Naimi TS. The impact of a 25-cent-per-drink alcohol tax increase. American journal of preventive medicine. 2012;42(4):382–389. doi: 10.1016/j.amepre.2011.12.008 22424251

13. Holmes J, Meng Y, Meier PS, Brennan A, Angus C, Campbell-Burton A, et al. Effects of minimum unit pricing for alcohol on different income and socioeconomic groups: a modelling study. The Lancet. 2014;383(9929):1655–1664. doi: 10.1016/S0140-6736(13)62417-4

14. Vandenberg B, Sharma A. Are alcohol taxation and pricing policies regressive? Product-level effects of a specific tax and a minimum unit price for alcohol. Alcohol and alcoholism. 2016;51(4):493–502. doi: 10.1093/alcalc/agv133 26719379

15. Byrnes J, Shakeshaft A, Petrie D, Doran CM. Is response to price equal for those with higher alcohol consumption? The European Journal of Health Economics. 2016;17(1):23–29. doi: 10.1007/s10198-014-0651-z 25407840

16. Manning WG, Blumberg L, Moulton LH. The demand for alcohol: the differential response to price. Journal of Health Economics. 1995;14(2):123–148. doi: 10.1016/0167-6296(94)00042-3 10154654

17. Sharma A, Etilé F, Sinha K. The effect of introducing a minimum price on the distribution of alcohol purchase: a counterfactual analysis. Health economics. 2016;25(9):1182–1200. doi: 10.1002/hec.3388 27427503

18. Chernozhukov V, Hong H. Three-step censored quantile regression and extramarital affairs. Journal of the American Statistical Association. 2002;97(459). doi: 10.1198/016214502388618663

19. Chernozhukov V, Fernández-Val I, Melly B. Inference on counterfactual distributions. Econometrica. 2013;81(6):2205–2268. doi: 10.3982/ECTA10582

20. Calcott P. Minimum unit prices for alcohol. Journal of health economics. 2019;66:18–26. doi: 10.1016/j.jhealeco.2019.04.007 31078015

21. (ANPHA) ANPHA. Exploring the Public Interest Case for A Minimum (Floor) Price for Alcohol: Draft Report; 2013.

22. ABS. Apparent consumption of alcohol, Australia, 2013-14. Cat no. 2015;4307.0.55.001.

23. Foster JH, Ferguson C. Alcohol “pre-loading”: a review of the literature. Alcohol and Alcoholism. 2013;49(2):213–226. doi: 10.1093/alcalc/agt135 24049152

24. Livingston M. Understanding recent trends in Australian alcohol consumption. Foundation for Alcohol Research and Education: Canberra, Australia. 2015.

25. Stockwell T, Zhao J, Martin G, Macdonald S, Vallance K, Treno A, et al. Minimum alcohol prices and outlet densities in British Columbia, Canada: estimated impacts on alcohol-attributable hospital admissions. American journal of public health. 2013;103(11):2014–2020. doi: 10.2105/AJPH.2013.301289 23597383

26. Stockwell T, Auld MC, Zhao J, Martin G. Does minimum pricing reduce alcohol consumption? The experience of a Canadian province. Addiction. 2012;107(5):912–920. doi: 10.1111/j.1360-0443.2011.03763.x 22168350

27. Zhao J, Stockwell T, Martin G, Macdonald S, Vallance K, Treno A, et al. The relationship between minimum alcohol prices, outlet densities and alcohol-attributable deaths in B ritish C olumbia, 2002–09. Addiction. 2013;108(6):1059–1069. doi: 10.1111/add.12139 23398533

28. Purshouse RC, Meier PS, Brennan A, Taylor KB, Rafia R. Estimated effect of alcohol pricing policies on health and health economic outcomes in England: an epidemiological model. The Lancet. 2010;375(9723):1355–1364. doi: 10.1016/S0140-6736(10)60058-X

29. Holmes J, Meier PS, Angus C, Brennan A. Scotland’s policy on minimum unit pricing for alcohol: the legal barriers are gone, so what are the implications for implementation and evaluation? Addiction. 2018;113(2):203–204. doi: 10.1111/add.14125 29314407

30. Ejebu OZ, McKenzie L, Ludbrook A. Household purchasing of cheap alcohol: Who would be most affected by minimum unit pricing? Nordic Journal of Health Economics. 2018. doi: 10.5617/njhe.4878

31. Jiang H, Room R. Action on minimum unit pricing of alcohol: a broader need. The Lancet. 2018;391(10126):1157. doi: 10.1016/S0140-6736(18)30496-3

32. Rankin G, Livingston M. Understanding alcohol sales data in Australia; 2016.

33. Ruhm CJ, Jones AS, McGeary KA, Kerr WC, Terza JV, Greenfield TK, et al. What US data should be used to measure the price elasticity of demand for alcohol? Journal of Health Economics. 2012;31(6):851–862. doi: 10.1016/j.jhealeco.2012.08.002 23022631

34. Etilé F, Sharma A. Do High Consumers of Sugar-Sweetened Beverages Respond Differently to Price Changes? A Finite Mixture IV-Tobit Approach. Health economics. 2015;24(9):1147–1163. doi: 10.1002/hec.3157 25676493

35. Sharma A, Hauck K, Hollingsworth B, Siciliani L. THE EFFECTS OF TAXING SUGAR-SWEETENED BEVERAGES ACROSS DIFFERENT INCOME GROUPS. Health Economics. 2014;23:1159–1184. doi: 10.1002/hec.3070 24895084

36. Finkelstein EA, Zhen C, Bilger M, Nonnemaker J, Farooqui AM, Todd JE. Implications of a sugar-sweetened beverage (SSB) tax when substitutions to non-beverage items are considered. Journal of Health Economics. 2012. doi: 10.1016/j.jhealeco.2012.10.005 23202266

37. Adjemian MK, Volpe RJ. Alcohol consumption and food-at-home dietary quality in the United States. In: Agricultural & Applied Economics Association Annual Meeting, Seattle, Washington; 2012.

38. Harding M, Leibtag E, Lovenheim MF. The heterogeneous geographic and socioeconomic incidence of cigarette taxes: Evidence from Nielsen Homescan Data. American Economic Journal: Economic Policy. 2012;4(4):169–98.

39. Einav L, Leibtag E, Nevo A. On the accuracy of Nielsen Homescan data. USDA, Economic Research Service; 2008.

40. Euromonitor. Alcoholic drinks in Australia. Euromonitor International Ltd. London; 2016.

41. Fogarty J. The demand for beer, wine and spirits: a survey of the literature. Journal of Economic Surveys. 2010;24(3):428–478.

42. Deaton A. Quality, quantity, and spatial variation of price. The American Economic Review. 1988; p. 418–430.

43. Zhen C, Finkelstein EA, Nonnemaker JM, Karns SA, Todd JE. Predicting the Effects of Sugar-Sweetened Beverage Taxes on Food and Beverage Demand in a Large Demand System. American Journal of Agricultural Economics. 2014;96(1):1–25. doi: 10.1093/ajae/aat049 24839299

44. Hausman JA. Valuation of new goods under perfect and imperfect competition. In: The economics of new goods. University of Chicago Press; 1996. p. 207–248.

45. Jiang H, Callinan S, Livingston M, Room R. Off-premise alcohol purchasing in Australia: Variations by age group, income level and annual amount purchased. Drug and alcohol review. 2017;36(2):210–219. doi: 10.1111/dar.12402 27219829

46. Meier PS, Purshouse R, Brennan A. Policy options for alcohol price regulation: the importance of modelling population heterogeneity. Addiction. 2010;105(3):383–393. doi: 10.1111/j.1360-0443.2009.02721.x 19839965

47. Borah BJ, Basu A. Highlighting differences between conditional and unconditional quantile regression approaches through an application to assess medication adherence. Health economics. 2013;22(9):1052–1070. doi: 10.1002/hec.2927 23616446

Článek vyšel v časopise


2019 Číslo 12