Alcohol Consumption in Family Budgets: Effects of Purchasing Power and Households Demographic Composition

Abstract

Among the problems associated with family alcohol consumption is the effect on household resource distribution, with a larger incidence in those households that are socially more vulnerable. This study examines the influence that household socioeconomic and demographic characteristics have on the share of alcoholic beverages in the household budget, using data from Santa Fe, Argentina for the period 2004-2005. Engel parametric curves are estimated using a sample selection model (Tobit type II). The sample is subdivided using the poverty line as the criterion. The results show that the most relevant characteristics differ depending on whether the household is poor or not. In non-poor households, variables such as the age of the household head, the share of women and the number of minors have a statistically significant effect on alcohol’s share of expenditures. In contrast, only characteristics related to purchasing power are relevant in poor households.