Abstract
In this study we exploit the 2008 Icelandic economic collapse to explore the effect of a macroeconomic downturn on drinking behavior across gender and types of drinkers. Using comprehensive panel data, we furthermore shed light on the role of real income and working hours as mechanisms that may explain changes in drinking patterns pre to post the collapse. The unique panel data is from 2007 to 2009, incidentally before and after the crisis hit, and was collected as a postal survey by The Directorate of Health. We specifically explore four outcomes: Frequency of any alcohol consumption, frequency of binge drinking, binge drinking participation and alcohol dependence, using pooled OLS and linear probability models. We find that women tend to decrease their frequency of any alcohol consumption and frequency of binge drinking more than men between waves but men show a stronger negative response to the crisis in binge drinking participation and alcohol dependence. Changes in individual income explain most of men’s reduction in drinking, but women’s drinking responses are not operating through labor-market mechanisms to the same extent. Other factors in the demand function for alcohol that changed during the crisis seem to play a greater role, most notably the real price of alcohol, which increased considerably following the economic collapse.
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Notes
An extensive summary of possible pathways is offered in Dávalos et al. (2012).
These questions entered the survey as 3 out of 10 questions in the Alcohol Use Disorders Identification Test (AUDIT), developed for the World Health Organization (Saunders et al. 1993) and they are similar to some of the questions in Diagnostic and Statistical Manual of Mental Disorders for diagnosis of alcohol abuse/alcohol dependence (DSM-IV) and Alcohol Use Disorder (DSM-5) originating from The American Psychiatric Association (American Psychiatric Association 1994, 2013). We could not use the same diagnostic criteria, with our data, for alcohol abuse/alcohol dependency or alcohol use disorder as in DSM-IV and DSM-5 where there are 5, 6 and 11 questions in total (respectively). Our measure of alcohol dependence will therefore result in a larger proportion being identified as “alcohol dependent” than when the diagnostic criteria described in DSM-IV and DSM-5 is used, since an individual only needs to answer one of the three questions positively in our measure as opposed to at least 2 or 3 of the more options given in the diagnostic criteria that we refer to.
In the instances where proportionally larger mediation effect was detected by using household income as a mediator as opposed to individual income, it was associated with less precision in the corresponding point estimates. This result, combined with the problems inherent to the construction of the household income variable, does not warrant replacing individual income with household income. Results available upon request.
Exchange rate was about 123 krona to the US dollar at the end of November 2009 (The Central Bank of Iceland 2014). Thus, 1 million krona translates to about US$ 8,150.
Consistent with Baron and Kenny´s framework (1986) for how to conduct a mediation analysis, income and work hours are likely mediators for any alcohol consumption and work hours is a likely mediator for binge drinking consumption.
Ásgeirsdóttir et al. used the same data as in the current study but used different set of mediators; household income, work hours, loss in financial assets, increased mortgage debt and anxiety and poor mental health with FE-models. They furthermore only use one drinking outcome.
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Acknowledgments
Financial support from the University of Iceland Research Fund, Edda Center of Excellence and the Icelandic Research Fund (Grant Number 130611-051) is gratefully acknowledged. We thank the Editor-in-Chief Shoshana Grossbard and two anonymous reviewers for helpful comments and suggestions. We also thank Birgir Hrafnkelsson and Helgi Tómasson for technical assistance and Dhaval Dave for constructive comments and feedback.
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Ólafsdóttir, T., Ásgeirsdóttir, T.L. Gender differences in drinking behavior during an economic collapse: evidence from Iceland. Rev Econ Household 13, 975–1001 (2015). https://doi.org/10.1007/s11150-015-9283-z
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DOI: https://doi.org/10.1007/s11150-015-9283-z