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Heterogeneity in Alcohol Consumption: The Case of Beer, Wine and Spirits in Australia

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  • Ramful, Preety
  • Zhao, Xueyan

Abstract

This paper examines Australians' participation in beer, wine and spirits consumption using a trivariate probit model and unit-record data from the National Drug Strategy Household Surveys. It estimates the effects of social, economic and demographic factors on an individual's decisions of alcohol participation. The trivariate probit formulation allows for the potential correlation across the demand for the three products through unobserved personal characteristics. All three beverages are shown to have negative own-price elasticities and to be substitutes in participation. An alarming proportion of young Australians are found to be drinking spirits regularly due to the increasing popularity of pre-mixed sweet drinks.

Suggested Citation

  • Ramful, Preety & Zhao, Xueyan, 2006. "Heterogeneity in Alcohol Consumption: The Case of Beer, Wine and Spirits in Australia," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25359, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae06:25359
    DOI: 10.22004/ag.econ.25359
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    References listed on IDEAS

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    7. Xueyan Zhao & Mark Harris & Preety Ramful, 2004. "Alcohol Consumption in Australia: An Application of the Ordered Generalised Extreme Value Model," Econometric Society 2004 Australasian Meetings 301, Econometric Society.
    8. Chang, Hui-Shung & Griffith, Garry & Bettington, Nicholas, 2002. "The Demand for Wine in Australia Using a Systems Approach: Industry Implications," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 10, pages 1-12, September.
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    Cited by:

    1. Preety Srivastava & Xueyan Zhao, 2010. "What Do the Bingers Drink? Microeconometric Evidence on Negative Externatilities of Alcohol Consumption by Beverage Types," Monash Econometrics and Business Statistics Working Papers 1/10, Monash University, Department of Econometrics and Business Statistics.
    2. Preety Srivastava & Keith R. McLaren & Michael Wohlgenant & Xueyan Zhao, 2014. "Econometric Modelling of Price Response by Alcohol Types to Inform Alcohol Tax Policies," Monash Econometrics and Business Statistics Working Papers 5/14, Monash University, Department of Econometrics and Business Statistics.

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