work is the curse of the drinking classes?

Doug Henwood dhenwood at panix.com
Fri Nov 2 16:00:56 PST 2001


"Alcohol Taxes and Labor Market Outcomes"

BY: DHAVAL DAVE

Graduate Center CUNY

Department of Economics

National Bureau of Economic Research (NBER)

ROBERT KAESTNER

University of Illinois at Chicago

Institute of Government and Public Affairs

National Bureau of Economic Research (NBER), at New

York

Document: Available from the SSRN Electronic Paper Collection:

http://papers.ssrn.com/paper.taf?abstract_id=288475

Paper ID: NBER Working Paper No. W8562

Date: October 2001

Contact: ROBERT KAESTNER

Email: Mailto:kaestner at uic.edu

Postal: University of Illinois at Chicago

Institute of Government and Public Affairs

815 West Van Buren Street, Suite 525

Chicago, IL 60607 USA

Phone: 312-996-8227

Co-Auth: DHAVAL DAVE

Email: not available

Postal: Graduate Center CUNY

Department of Economics

Graduate Center

New York, NY 10036 USA

ABSTRACT:

In this paper, we present estimates of the effect of alcohol

taxes on employment, hours of work per week, and wages. These

are reduced form estimates derived from a structural model

linking alcohol use to labor market outcomes. The reduced form

estimates are meaningful in two ways: first, they provide

estimates of the effect of an important public policy tool,

alcohol taxes, on labor market outcomes, and second, they can be

used to evaluate hypotheses about the structural effects of

alcohol use on labor market outcomes. The results of the

analysis suggest that alcohol taxes are unrelated to employment,

hours of work, and wages. Estimates of the effect of alcohol

taxes on labor market outcomes were large and imprecise, and

characterized by significant variation in sign and magnitude

across samples and types of alcohol taxes. This suggests that

there is a weak and indeterminate relationship between alcohol

taxes and labor market outcomes. This finding implies that

alcohol use does not adversely affect labor market outcomes and

is inconsistent with findings from previous studies.



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