Rational Alcohol Addiction: Evidence from the Russian Longitudinal Monitoring Survey

Syracuse University Center for Policy Research Working Paper No. 81

38 Pages Posted: 20 Apr 2011

See all articles by Badi H. Baltagi

Badi H. Baltagi

Syracuse University; CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics; Syracuse University - Maxwell School of Citizenship and Public Affairs

Ingo Geishecker

Free University of Berlin (FUB) - Department of Business and Economics

Date Written: April 1, 2006

Abstract

Alcohol consumption in Russia is legendary and has been reported to be the third leading cause of death in the former Soviet Union after heart disease and cancer. Are Russian alcohol consumers rational addicts? This paper uses eight rounds of a nationally representative Russian survey spanning the period 1994-2003 to estimate a rational addiction (RA) model for alcohol consumption. This is done in a panel data setting as well as on a wave by wave basis. The profile of the Russian drinker and a huge difference between males and females and the model is estimated by gender. We do not find support for the RA model in Russia for women. For men, although we find that some implications of the RA model are satisfied, we fail to endorse the model empirically on grounds of implausible negative estimates of the discount rate.

Keywords: Panel Data, Liquor Consumption, Rational Addiction

JEL Classification: C23, D12, I10

Suggested Citation

Baltagi, Badi H. and Geishecker, Ingo, Rational Alcohol Addiction: Evidence from the Russian Longitudinal Monitoring Survey (April 1, 2006). Syracuse University Center for Policy Research Working Paper No. 81, Available at SSRN: https://ssrn.com/abstract=1815287 or http://dx.doi.org/10.2139/ssrn.1815287

Badi H. Baltagi (Contact Author)

Syracuse University ( email )

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HOME PAGE: http://https://pbaltagi.wix.com/badibaltagi

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

IZA Institute of Labor Economics

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Bonn, D-53072
Germany

Syracuse University - Maxwell School of Citizenship and Public Affairs ( email )

400 Eggers Hall
Syracuse, NY 13244
United States

Ingo Geishecker

Free University of Berlin (FUB) - Department of Business and Economics ( email )

Boltzmannstrasse 20
D-14195 Berlin, 14195
Germany

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