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Price elasticities of alcohol demand: evidence from Russia

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Abstract

In this paper, we estimate price elasticities of demand of several types of alcoholic drinks, using 14 rounds of data from the Russia Longitudinal Monitoring Survey-HSE, collected from 1994 until 2009. We deal with potential confounding problems by taking advantage of a large number of control variables, as well as by estimating community fixed effect models. All in all, although alcohol prices do appear to influence consumption behaviour in Russia, in most cases the size of effect is modest. The finding that two particularly problematic drinks—cheap vodka and fortified wine—are substitute goods also suggests that increasing their prices may not lead to smaller alcohol consumption. Therefore, any alcohol pricing policies in Russia must be supplemented with other measures, such as restrictions on numbers of sales outlets or their opening times.

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Notes

  1. http://www.cpc.unc.edu/projects/rlms-hse/data/documentation/faq.

  2. There were about 160 RLMS-defined population centres in earlier rounds, which increased to 177 by round 18. The number of respondents in each community varied depending on the size of the underlying population, ranging from 1 (in very small villages) to more than 300 (regional capitals, Moscow or St Petersburg). The average number of respondents per community was 61.

  3. For example, for round 14, more information on this data can be found at http://www.cpc.unc.edu/projects/rlms-hse/data/questionnaires/rncomm.pdf.

  4. http://www.gks.ru/.

  5. Details on all the dependent and independent variables and covariates can be found at http://www.cpc.unc.edu/rlms.

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Acknowledgments

We are grateful to David Leon and Katie Cole for their comments and contributions to this manuscript. This paper was undertaken as part of the Health in Times of Transition (HITT) Project which was funded by the European Union’s 7th Framework Programme, project HEALTH-F2-2009-223344. The European Commission cannot accept any responsibility for any information provided or views expressed. Yevgeniy Goryakin was in part supported by the Centre for Diet and Activity Research (CEDAR), a UKCRC Public Health Research Centre of Excellence.

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Authors and Affiliations

  1. Norwich Medical School, University of East Anglia, Norwich, NR4 7TJ, UK

    Yevgeniy Goryakin

  2. UKCRC Centre for Diet and Activity Research (CEDAR), Cambridge, UK

    Yevgeniy Goryakin

  3. Department of Health Services Research and Policy, European Centre on Health of Societies in Transition, London School of Hygiene and Tropical Medicine, 5–17 Tavistock Place, London, WC1H 9SH, UK

    Bayard Roberts & Martin McKee

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  1. Yevgeniy Goryakin
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Correspondence to Yevgeniy Goryakin.

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Goryakin, Y., Roberts, B. & McKee, M. Price elasticities of alcohol demand: evidence from Russia. Eur J Health Econ 16, 185–199 (2015). https://doi.org/10.1007/s10198-014-0565-9

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