The most important contribution of this research lies in considering the impact of wine, beer and liquors on the ratio of traffic fatalities because each kind of alcoholic beverage is characterized by different ethanol content. The data, drawn for case of Spain, validate our theoretical hypothesis. Our findings support the strategy of incrementing alcohol taxes in order to reduce the negative externalities of alcohol abuse. However, it is necessary to implement non-economic policies because of the existence of collateral effects (positive crossed price elasticities). (Author/publisher)
Abstract