The Long-Run Effects of a Public Policy on Alcohol Tastes and Mortality

80 Pages Posted: 24 Jul 2014

See all articles by Lorenz Kueng

Lorenz Kueng

University of Lugano - Faculty of Economics; Swiss Finance Institute; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); Northwestern University - Kellogg School of Management

Evgeny Yakovlev

NES

Date Written: July 2014

Abstract

We study the long-run effects of Russia's anti-alcohol campaign, which dramatically altered the relative supply of hard and light alcohol in the late 1980s. We find that this policy shifted young men's long-run preferences from hard to light alcohol decades later and we estimate the age at which consumers form their tastes. We show that the large beer market expansion in the late 1990s had similar effects on young consumers' tastes, while older consumers' tastes remained largely unchanged. We then link these long-run changes in alcohol consumption patterns to changes in male mortality. The shift from hard to light alcohol reduced incidences of binge drinking substantially, leading to fewer alcohol- related deaths. We conclude that the resulting large cohort differences in current alcohol consumption shares explain a significant part of the recent decrease in male mortality. Simulations suggest that mortality will continue to decrease by another 23% over the next twenty years due to persistent changes in consumer tastes. Program impact evaluations that focus only on contemporaneous effects can therefore severely underestimate the total effect of such public policies that change preferences for goods.

Suggested Citation

Kueng, Lorenz and Yakovlev, Evgeny, The Long-Run Effects of a Public Policy on Alcohol Tastes and Mortality (July 2014). NBER Working Paper No. w20298. Available at SSRN: https://ssrn.com/abstract=2471191

Lorenz Kueng (Contact Author)

University of Lugano - Faculty of Economics

Via Giuseppe Buffi 13
Lugano, TI 6904
Switzerland

HOME PAGE: http://www.usi.ch/en

Swiss Finance Institute

c/o University of Geneva
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CH-1211 Geneva 4
Switzerland

HOME PAGE: http://www.sfi.ch/en/

National Bureau of Economic Research (NBER)

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Centre for Economic Policy Research (CEPR)

London
United Kingdom

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Northwestern University - Kellogg School of Management

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Evanston, IL 60208
United States
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HOME PAGE: http://www.kellogg.northwestern.edu/

Evgeny Yakovlev

NES ( email )

100A Novaya Street
Moscow, Skolkovo 143026
Russia

HOME PAGE: http://https://sites.google.com/site/evgenyyakovlev/

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