Persistence in Alcohol Consumption: Evidence from Migrants

Abstract

How malleable is alcohol consumption? Specifically, how much is alcohol consumption driven by the current environment versus individual characteristics? To answer this question, we analyze changes in alcohol purchases when consumers move from one state to another in the United States. Right after moving, movers' alcohol purchases converge sharply toward the average level in their destination state, implying that the current environment explains about two-thirds of the differences in alcohol purchases. The adjustment takes place both on the extensive and intensive margin.

Alcohol and Self-Control: A Field Experiment in India

“…Instead of being able to withdraw money during any of their daily visits between 6 pm and 10 pm, they were only allowed to withdraw money at the end of their participation in the study. 11 Notably, the savings option for the remaining individuals also entailed a weak commitment feature. While individuals could withdraw as much as they desired on any given office visit, they were only able to withdraw money in the evenings, i.e., between 6 pm and 10 pm.…”

“…The implied daily interest rate from saving an additional rupee increased for each participant over the course of his participation in the study. However, anecdotal evidence suggests that few individuals were aware of this feature 11. For ethical reasons, all individuals had the option to leave the study and withdraw all of their money on any day of the study 12.…”