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Cross-Border Health and Productivity Effects of Alcohol Policies

Per Johansson (), Tuomas Pekkarinen () and Jouko Verho
Additional contact information
Tuomas Pekkarinen: VATT, Helsinki

No 6389, IZA Discussion Papers from Institute of Labor Economics (IZA)

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 on the effect of the Finnish tax cut on mortality and alcohol-related hospitalisations in Sweden are very imprecise. However, we find that workplace absenteeism increased by 5% for males and by 13% for females near the Finnish border as a result of the tax cut.

Keywords: alcohol taxes; health effects of alcohol; cross-border shopping (search for similar items in EconPapers)
JEL-codes: H23 H73 I18 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2012-02
New Economics Papers: this item is included in nep-eur and nep-hea
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Published in: Journal of Health Economics, 2014, 36, 125-136

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Related works:
Journal Article: Cross-border health and productivity effects of alcohol policies (2014) Downloads
Working Paper: Cross-border health and productivity effects of alcohol policies (2012) Downloads
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