TY  - JOUR
AU  - Ruhm,Christopher J.
AU  - Jones,Alison Snow
AU  - Kerr,William C.
AU  - Greenfield,Thomas K.
AU  - Terza,Joseph V.
AU  - Pandian,Ravi S.
AU  - McGeary,Kerry Anne
TI  - What U.S. Data Should be Used to Measure the Price Elasticity of Demand for Alcohol?
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 17578
PY  - 2011
Y2  - November 2011
UR  - http://www.nber.org/papers/w17578
L1  - http://www.nber.org/papers/w17578.pdf
N1  - Author contact info:
Christopher J. Ruhm
Frank Batten School of
Leadership and Public Policy
University of Virginia
235 McCormick Rd.
P.O. Box 400893
Charlottesville, VA 22904-4893
Tel: 434-243-3729
E-Mail: ruhm@virginia.edu

Alison Snow Jones
E-Mail: N/A user is deceased

William C. Kerr
Alcohol Research Group
Public Health Institute
6475 Christie Avenue, Suite 400
Emeryville, CA 94608-1010
E-Mail: wkerr@arg.org

Thomas K. Greenfield
Alcohol Research Group
Public Health Institute
6475 Christie Avenue, Suite 400
Emeryville, CA 94608-1010
E-Mail: tgreenfield@arg.org

Joseph V. Terza
Department of Economics
University of North Carolina at Greensboro
Greensboro, NC 27402-6165
E-Mail: jvterza@uncg.edu

Ravi S. Pandian
Department of Health Management and Policy
Drexel University
Philadelphia, PA 19102
E-Mail: rsp46@drexel.edu

Kerry Anne McGeary
Department of Economics
Miller College of Business
Whitinger Business Building, RM 129
Ball State University
Muncie, IN 47306
Tel: 765-285-5378
Fax: 765-285-4313
E-Mail: kmcgeary@bsu.edu
AB  - This paper examines how estimates of the price elasticity of demand for beer vary with the choice of alcohol price series examined. Our most important finding is that the commonly used ACCRA price data are unlikely to reliably indicate alcohol demand elasticities—estimates obtained from this source vary drastically and unpredictably. As an alternative, researchers often use beer taxes to proxy for alcohol prices. While the estimated beer taxes elasticities are more stable, there are several problems with using taxes, including difficulties in accounting for cross-price effects. We believe that the most useful estimates reported in this paper are obtained using annual Uniform Product Code (UPC) “barcode” scanner data on grocery store alcohol prices. These estimates suggest relatively low demand elasticity, probably around -0.3, with evidence that the elasticities are considerably overstated in models that control for beer but not wine or spirits prices.
ER  -