Alcohol demand among young people in Spain: an addictive QUAIDS |
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Authors: | Ana Isabel Gil José Alberto Molina |
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Institution: | (1) Human Ecology College, Cornell University, Ithaca, NY, USA;(2) Department of Economic Analysis, University of Zaragoza, Zaragoza, Spain;(3) IZA, Bonn, Germany |
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Abstract: | This paper analyzes the demand for alcoholic beverages among young people in Spain. To that end, we develop a theoretical
model which combines elements from the Theory of Two-Stage Budgeting and the Theory of Addiction, with this being empirically
translated into a Quadratic Almost Ideal Demand System (QUAIDS) in which the particular characteristics of young people are
introduced by Price Scaling (PS) techniques. We then estimate this specification by using data drawn from the Spanish National
Survey on Drug Use in the School Population (2000) and the Spanish National Household Survey (2000). Given that wine, beer
and spirits all have normal demands, our results suggest that a tax increase imposed with the intention of reducing alcohol
consumption would appear to be efficient.
This paper was partially written while Ana Isabel Gil was a Visiting Researcher at the London School of Economics and Political
Science, to which she would like to express her gratitude for the hospitality and facilities provided. An earlier version
of this paper has been presented at the Spanish Economic Analysis Meeting-2003 (Sevilla, Spain) with all the comments made
by the participants being appreciated. Finally, the authors would like to express their thanks for the financial support provided
by the Spanish Ministry of Education-CICYT and the European Commission (Project 2FD97-2057). The usual disclaimer applies. |
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Keywords: | Alcohol demand Young people Addictive QUAIDS |
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