The purpose of this paper is to test Becker and Murphy's (1988) rational addiction model on (35 years of) time series data on alcohol consumption in each of the four Nordic countries: Denmark, Finland, Norway and Sweden. The empirical relevance of rational addiction theory is assessed by...

The paper deals with alcohol consumption in Denmark, Norway and sweden during the last three decades. The regimes in these countries have been significantly different with regard to taxation of pricing and access to buy alcohol.