The Influence of Advertising on Alcohol Consumption: A Literature Review and An Econometric Analysis of Four European Nations

Abstract

Econometric and laboratory research in the US, Canada and the UK have not revealed advertising to have a significant effect on alcohol consumption. The same is true of survey research, which confirms the powerful role of social factors such as the attitudes and behaviour of parents and peers. We present an econometric analysis of the alcoholic beverage markets of France, Germany, the Netherlands, Sweden (where alcohol advertising has been prohibited since 1979), as well as a new analysis of the UK market. The results provide further support for the view that advertising does not have a substantial effect on alcohol sales. The data also show that social forces other than prices and income were bringing about a strong reduction in demand for alcoholic beverages during the 1970s and 1980s, and that advertising did nothing to ward off this trend.