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Broadcast Advertising and U.S. Demand for Alcoholic Beverages

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  • Jon P. Nelson

Abstract

Quarterly data for 1977‐1994 on alcohol consumption and advertising are used to estimate a differential demand system, including explanatory variables for broadcast advertising and print advertising. The model explains the growth rate of per capita consumption dependent on explanatory variables for prices, real income, demographic changes, and real advertising by media and beverage. Empirical results also are reported for total consumption of pure alcohol. The results for the three beverages and total alcohol indicate that advertising has little or no effect on demand. The empirical evidence thus supports the notion that regardless of media, advertising affects mainly brand shares.

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  • Jon P. Nelson, 1999. "Broadcast Advertising and U.S. Demand for Alcoholic Beverages," Southern Economic Journal, John Wiley & Sons, vol. 65(4), pages 774-790, April.
    • Handle: RePEc:wly:soecon:v:65:y:1999:i:4:p:774-790
    DOI: 10.1002/j.2325-8012.1999.tb00199.x
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    1. Barten, Anton P, 1993. "Consumer Allocation Models: Choice of Functional Form," Empirical Economics, Springer, vol. 18(1), pages 129-158.
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    Cited by:

    1. Concetta CASTIGLIONE & Ladislava GROCHOVÁ & Davide INFANTE & Janna SMIRNOVA, 2011. "The demand for beer in presence of past consumption and advertising in the Czech Republic," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 57(12), pages 589-599.
    2. Henry Saffer & Dhaval Dave, 2002. "Alcohol consumption and alcohol advertising bans," Applied Economics, Taylor & Francis Journals, vol. 34(11), pages 1325-1334.
    3. Toshinobu Matsuda, 2005. "Differential Demand Systems: A Further Look at Barten's Synthesis," Southern Economic Journal, John Wiley & Sons, vol. 71(3), pages 607-619, January.
    4. Yin Xia & Steven Buccola, 2003. "Factor Use and Productivity Change in the Alcoholic Beverage Industries," Southern Economic Journal, John Wiley & Sons, vol. 70(1), pages 93-109, July.

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