Vox:
Minimum prices for alcohol should work
30 June 2014
Setting a binding minimum alcohol price raises prices, which should lower consumption. The consumption responsiveness - i.e. the elasticity of demand - is not the same for all groups. In particular, younger adults tend to be more price-sensitive. Evidence suggests that raising alcohol prices can be an effective intervention to reduce access of the younger populations (Anderson and Baumberg 2006). However, for this sort of policy to make a difference, and to avoid the 'law of unintended consequences', one needs to identify the target group and consider substitutes. For example, it would be important to prevent a shift by youngsters to lower quality alcohol. This suggests a minimum price across the board - applying the policy to every type of alcohol - if one is to discourage substitution and hence achieve lower consumption by younger people.
This article was published online by Vox on June 30, 2014
Link to article here
Related Links
Joan Costa-i-Font webpage
Wellbeing Programme webpage