Did Alcohol Policy Really Cause the Postsocialist Mortality Crisis? Revisiting the Rebound and Affordability Hypotheses

This article reexamines the argument that alcohol policies were the major factor behind the mortality crisis in postsocialist Russia. We show that the correlation between the Gorbachev anti-alcohol campaign (rebound hypothesis), alcohol prices in the 1990s (affordability hypothesis), and mortality reported in previous analyses is not robust to splitting oblasts into Far-East and the rest of Russia. Our analysis conducted on a sample of 534 towns in the European part of Russia also finds no robust evidence supporting the two hypotheses. In contrast, findings linking privatization to mortality are robust to controlling for the anti-alcohol campaign and the affordability of alcohol.

Potential impact of minimum unit pricing on advertised alcoholic beverage prices

The current study sought to determine the potential effect of a minimum unit price policy on advertised prices for alcoholic beverages at an off-premise outlet. A free, weekly circular was monitored for advertised alcohol prices from July 2017 to June 2018. For each advertised price, the number of standard drinks per purchase, the price per standard drink, and the frequency of prices that would increase under a MUP policy similar to Scotland’s was determined. There was an inverse correlation between the number of standard drinks per purchase and the advertised price per standard drink for beer/malt beverages (r = -0.76, p < 0.001) and wine (r = -0.42, p < 0.001), which would be eliminated under MUP. Under MUP, 59.8% of advertised prices for beer/malt beverages would increase. Implementation of MUP may significantly impact beer and malt beverage prices in the off-premise location monitored in the study.

Adult Mortality in Russia: A Microanalysis (translation: Marina Beletskaya)

This paper studies the determinants of Russian adult mortality controlling for both individual and household heterogeneity. We employ survival analysis and utilize 12 rounds of the Russian Longitudinal Monitoring Survey spanning a 14-year period. Although confirming the crucial role of excessive alcohol consumption in shaping adult mortality risks in Russia, the results are original in several other respects. We find empirical support for the importance of relative status measured in non-income terms in shaping mortality hazards. We find evidence of the influence of labour market behaviour, and sectoral and occupational mobility in particular, on longevity. The detrimental role of smoking to health is found to be comparable with the role of excess alcohol consumption, which is novel in the Russian context where the influence of smoking is typically downplayed in comparison with alcoholism. Finally, we find no micro evidence in support of the political economy view based on a positive correlation between low alcohol prices and high mortality rates found in regional-level data.

Demand for Alcohol Consumption in Russia and Its Implication for Mortality

Alcohol abuse is widely blamed for the very high rate of male mortality in Russia. I estimate a structural model of the demand for alcohol that incorporates two features of alcohol consumption, peer effects and habits. I use a kink in the policy regime of the excise tax on alcohol and regional variation in alcohol regulations to estimate a price elasticity of demand for alcohol. I find that peer influence and habits are critical determinants of the response of alcohol demand to price changes. The estimates imply that increases in alcohol prices would yield significant reductions in mortality. (JEL D12, H25, I12, L66, P23, P36)

Our Priceless Youth

Young people’s excessive alcohol consumption is considered a societal problem in many countries, and higher alcohol taxes are often suggested as a possible remedy. Price increases cannot be effective if unnoticed, but little is known about young people’s alcohol price knowledge and sensitivity, as aggregate price sensitivity studies have produced ambiguous results. Applying individual data, this study examines young people’s knowledge of retail alcohol prices using two price memory tests. Results show that the majority holds fairly accurate reference prices, while a large segment intentionally checks in-store alcohol prices, though large variations exist across categories. Furthermore, logistic regressions revealed ‘purchased a special’ and ‘simple prices’ as determinants of alcohol price knowledge. The results suggest that alcohol tax increases must be significant to be effective when targeting young people. Otherwise, such increases go unnoticed and other policy instruments may perform better, not least when targeting the youngest, and thus most vulnerable group.