Level of alcohol consumption and worker’s labor market position. Multivariate probit model approach

This paper considers the influence of alcohol consumption on employment and income of workers on the Russian labor market Econometric model used in the analysis consists of system of the simultaneous equations Such problem definition gives the chance for the accounting for possible endogenously of alcohol consumption and estimation of simultaneous influence of alcohol consumption on employment and income The model has been estimated using a method of maximum simulated likelihood on the basis of data from RLMS Result shows that moderate drinking is associated with higher probability of employment and income than heavy drinking and abstention from alcohol, whereas heavy drinking is positively connected only with income relative to abstention, but leads to lower probability of employment