The International Nature of Alcohol as Determined by a Cross-Country Analysis of Demographs and Pricing, 1995-2002

Few publications have attempted to tackle the nature of alcohol on a global level. Given its universal availability and the emerging amount of alcohol-related data, we explore the cross-country and cross-continent nature of alcohol. Similarly, the extremely visible global burden of disease attributed to consumption warrants its classification. Subject to available data, we find both relative price (incorporating income levels) and demographics of a nation to be the primary determinants of consumption and the effects of higher education and unemployment to be negligible. Further, we find the observed converging phenomenon of consumption rates to be attributable to the decreasing propensity to consume with age. Our results suggest alcohol is unclassifiable in the typical demand model as we observe more unresponsive price elasticity estimates as income rises, although more analysis needs to be performed once additional alcohol-related data is made available.