Financial Literacy and Alcohol Drinking Behavior: Evidence from Japan

Pongpat Putthinun, Somtip Watanapongvanich, Mostafa Saidur Rahim Khan and Yoshihiko Kadoya
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Pongpat Putthinun: School of Economics, Hiroshima University, 1-2-1 Kagamiyama, Higashihiroshima, Hiroshima 739-8525, Japan
Somtip Watanapongvanich: School of Economics, Hiroshima University, 1-2-1 Kagamiyama, Higashihiroshima, Hiroshima 739-8525, Japan
Mostafa Saidur Rahim Khan: School of Economics, Hiroshima University, 1-2-1 Kagamiyama, Higashihiroshima, Hiroshima 739-8525, Japan

Sustainability, 2021, vol. 13, issue 16, 1-13

Abstract: Alcohol consumption is an important public health issue in Japan due to its association with numerous side effects. Recent studies find that financial literacy helps people abstain from risky health behaviors such as smoking, lack of exercise, and gambling. This study investigates how financial literacy, as a rational decision-making instrument, is associated with alcohol consumption behavior in Japan. Using data from the Preference Parameter Study (PPS) of Osaka University, we categorize respondents into daily drinkers and non-daily drinkers. We find that financial literacy is not significantly associated with alcohol consumption among Japanese people. We argue that the prevailing social belief that alcohol consumption is not entirely negative from the health perspective and can be beneficial for socialization to some extent overrides people’s rationality and plays a significant role in alcohol consumption decisions. However, our study provides evidence that respondents who are males, middle-aged, have children, have higher household income, have smoking habits, and place more importance on the future are more likely to be daily drinkers. We argue that the availability and easy access to alcohol drinking opportunities likely make people irrational and tempts them to drink frequently. Thus, authorities might consider revising current policies regarding alcohol availability and accessibility to limit alcohol consumption.

Keywords: financial literacy; alcohol consumption; rationality; Japan (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:13:y:2021:i:16:p:8858-:d:610498

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