Persistence in Alcohol Consumption: Evidence from Migrants
42 Pages Posted: 9 Apr 2020 Last revised: 21 Sep 2020
Date Written: August 25, 2020
How malleable is alcohol consumption? Specifically, how much is alcohol consumption driven by the current environment versus individual characteristics? To answer this question, we analyze changes in alcohol purchases when consumers move from one state to another in the United States. Right after moving, movers’ alcohol purchases converge sharply toward the average level in their destination state, implying that the current environment explains about two-thirds of the differences in alcohol purchases. The adjustment takes place both on the extensive and intensive margin.
Keywords: alcohol, geographic variation, migration, taxes, regulation
JEL Classification: I12, L66, D12, I18
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