Household purchasing of cheap alcohol: Who would be most affected by minimum unit pricing?

Abstract

Minimum unit pricing of alcohol has been proposed as a more effective policy for reducing alcohol-related harms than general taxation. Growing international evidence points to its effectiveness in targeting high risk drinkers, but concerns about the impact on low risk drinkers and those on low incomes remain. This paper uniquely models the potential effect on both low risk and low income purchasers in a Scottish subsample of UK panel data from introducing a minimum unit price and addresses the impact of missing income data on the results. Weekly household purchases of cheap off-sales alcohol from Kantar Worldpanel (2008-2010) are analysed using Hausman-Taylor, Tobit and OLS models. Explanatory variables include economic and demographic characteristics of the households, average alcohol purchasing level for all off-sales alcohol, and characteristics of alcohol products purchased. The number of cheap alcohol units purchased are predicted by income group and purchasing level. Results indicate that the amount of cheap alcohol purchased is positively associated with the average purchasing level for all off-sales alcohol. Lower occupational group is associated with purchasing more units of cheap alcohol. Type of alcohol and purchasing alcohol on promotion are also highly significant. Predicted quantities of cheap alcohol purchased are not higher for the low-income group. Households in the top decile of alcohol purchasing level are predicted to purchase between 18 units of cheap alcohol weekly (low income) and 24 units (intermediate income). There was no evidence of bias due to missing income data. Minimum unit pricing for alcohol will have most impact on households purchasing the most alcohol, at all income levels. Restrictions on promotions should be considered as these are also associated with increased purchasing of cheap alcohol. Published: Online April 2018.