Advertising and Alcohol Demand in the UK: Further Results

Johnson (1985) presents a system-wide analysis on the effects of advertising on the demand for beer, wine and spirits in the UK. However, his results are not consistent with other studies in the area. This paper shows that his results can be improved by using a different demand equation for the alcoholic beverages group. Furthermore, this paper also considers the analysis of treating advertising as a stock rather than a flow. This analysis reveals that advertising on beer, wine and spirits depreciates in consumers' minds fully within a year.