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

81 Pages Posted: 9 May 2016 Last revised: 15 Jun 2020

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

New Economic School; IZA

Date Written: March 27, 2020

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.

Keywords: long-run policy effects, tastes, mortality, program evaluation

JEL Classification: D12, H31, I18, J18

Suggested Citation

Kueng, Lorenz and Yakovlev, Evgeny, The Long-Run Effects of a Public Policy on Alcohol Tastes and Mortality (March 27, 2020). Available at SSRN: https://ssrn.com/abstract=2776422 or http://dx.doi.org/10.2139/ssrn.2776422

Lorenz Kueng (Contact Author)

University of Lugano - Faculty of Economics

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Swiss Finance Institute

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National Bureau of Economic Research (NBER)

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Northwestern University - Kellogg School of Management

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Evgeny Yakovlev

New Economic School ( email )

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Russia

IZA ( email )

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Germany

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