• By Dartington SRU
  • Posted on Monday 17th May, 2010

Climbing on the wagon the Wagenaar way

The British drink problem has been thrown into sharper relief in recent months by the changing pattern of High Street retail. Wine store chains such as Threshers, which came to dominance during the 1970s collapsed, last November, leaving the field open to cut-price liquor sellers typified by the Bargain Booze franchise network.Defenders of Bargain Booze are ready to talk about the situation in France where, according to UK folklore, wine is cheap but responsibly consumed. True or not, it is a curious argument that casts purveyors of cut-price alcohol as part of the solution not the problem, and pretends that the availability of bargain booze in every small town will turn the country into a paradise of moderation, where the occasional glass of wine is sipped over dinner en famille.Nearly all of the evidence points the other way. The more drink costs, the less people buy. It is true for adults and it is true for young people. It is true not only in England but also in the 17 other countries who are able to marshal reliable data. Which is why most authorities agree that increasing tax on beer, wines and spirits dampens people’s enthusiasm for having “one too many”.Rather surprisingly, for a long time there were just two meta-analyses of findings on the issue, neither without methodological flaws. Now Alex Wagenaar and colleagues at the University of Florida have brought together 1,003 estimates of effect from 112 studies worldwide. And, in the process, they have addressed important methodological problems by separating out results on beer, wines and spirits.Wagenaar’s team measured price “elasticity” based on their hypothesis that higher prices drive down consumption. A score of zero to -0.1 on their scale indicated a small effect – that price had little impact. A score of -0.4 or anything more markedly minus suggested a big effect. The results are striking. For beer, price elasticity tuns out to be -0.46; for wine it is -0.69; for spirits -0.80. In a nutshell, the stronger the drink or the more it costs, the more price affects consumption. What about people who drink a lot? Wagenaar identified ten studies that looked at how the cost of alcohol influences the decisions of individual consumers.There was some variation in the results across studies, including one that found that increasing price only encouraged the barfly. But the rest found the opposite: on average, the impact of raised taxes on the binge drinker was a healthy -0.28.The results are especially challenging for the UK, since excise duty is already high. According the European Union, the government adds about $1.82 to the cost of a bottle of wine, compared to just three cents in France. The hard message from Wagenaar’s team appears to be that price proportional to the national culture is what matters. In other words, 25 cents more tax on every bottle of wine sold in France will be sufficient to reduce popular intake, whereas in the UK at least two dollars might be needed to achieve a similar effect.For the good of their health as they grapple with lower wages, higher unemployment and huge cuts to public sector services, the British people should be asked to drink less and pay more for it.See: Wagenaar A, Salois M and Komro K, “Effects of beverage alcohol price and tax levels on drinking: A meta-analysis of 1003 estimates from 112 studies”, Journal of Addiction, 104, 2, 179-190, 2009.

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