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Cross-border health and productivity effects of alcohol policies

Per Johansson (), Tuomas Pekkarinen and Jouko Verho

Journal of Health Economics, 2014, vol. 36, issue C, 125-136

Abstract: This paper studies the cross-border health and productivity effects of alcohol taxes. We estimate the effect of a large cut in the Finnish alcohol tax on mortality, alcohol-related illnesses and work absenteeism in Sweden. This tax cut led to large differences in the prices of alcoholic beverages between these two countries and to a considerable increase in cross-border shopping. The effect is identified using differences-in-differences strategy where changes in these outcomes in regions near the Finnish border are compared to changes in other parts of northern Sweden. We use register data where micro level data on deaths, hospitalisations and absenteeism is merged to population-wide micro data on demographics and labour market outcomes. Our results show that the Finnish tax cut did not have any clear effect on mortality or alcohol-related hospitalisations in Sweden. However, we find that workplace absenteeism increased by 9% for males and by 15% for females near the Finnish border as a result of the tax cut.

Keywords: Cross-border shopping; Alcohol taxes; Health effects of alcohol; Mortality; Absenteeism (search for similar items in EconPapers)
JEL-codes: H23 H73 I18 (search for similar items in EconPapers)
Date: 2014
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Related works:
Working Paper: Cross-border health and productivity effects of alcohol policies (2012) Downloads
Working Paper: Cross-Border Health and Productivity Effects of Alcohol Policies (2012) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhecon:v:36:y:2014:i:c:p:125-136

DOI: 10.1016/j.jhealeco.2014.04.002

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