The paper focuses on beer consumption in the Czech Republic, the country with the highest beer consumption per capita in the world. To understand recent beer-consumption behaviour, we use monthly data from a three year period, 2006–2008, to estimate both a 2SLS and a SUR model charting the demand for beer extended to past consumption and advertising expenditure. The demand for beer in the Czech Republic reacts more strongly to changes in price than it does to investments in advertising. The results suggest two implications for policy-makers. Consumption is as sensitive to the price of beer and its alternatives as it is to advertising, so whether there are taxes or restrictions on advertising can affect the consumption of beer, considering the long tradition of Czech consumers in drinking beer as the strong role of past consumption demonstrates.
The demand for beer in presence of past consumption and advertising in the Czech Republic
Castiglione C;INFANTE, Davide
;SMIRNOVA, JANNA
2011-01-01
Abstract
The paper focuses on beer consumption in the Czech Republic, the country with the highest beer consumption per capita in the world. To understand recent beer-consumption behaviour, we use monthly data from a three year period, 2006–2008, to estimate both a 2SLS and a SUR model charting the demand for beer extended to past consumption and advertising expenditure. The demand for beer in the Czech Republic reacts more strongly to changes in price than it does to investments in advertising. The results suggest two implications for policy-makers. Consumption is as sensitive to the price of beer and its alternatives as it is to advertising, so whether there are taxes or restrictions on advertising can affect the consumption of beer, considering the long tradition of Czech consumers in drinking beer as the strong role of past consumption demonstrates.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
