title: Cross-border health and productivity effects of alcohol policies.
abstract: This paper studies the cross-border health and productivity effects of alcohol taxes. We estimate the effect of a large cut in the Finnish alcohol tax on mortality, alcohol-related illnesses and work absenteeism in Sweden. This tax cut led to large differences in the prices of alcoholic beverages between these two countries and to a considerable increase in cross-border shopping. The effect is identified using differences-in-differences strategy where changes in these outcomes in regions near the Finnish border are compared to changes in other parts of northern Sweden. We use register data where micro level data on deaths, hospitalisations and absenteeism is merged to population-wide micro data on demographics and labour market outcomes. Our results show that the Finnish tax cut did not have any clear effect on mortality or alcohol-related hospitalisations in Sweden. However, we find that workplace absenteeism increased by 9% for males and by 15% for females near the Finnish border as a result of the tax cut.
authors.affiliation: IFAU and Department of Economics, Uppsala University and IZA, Sweden.
authors.forename: Per
authors.initials: P
authors.lastname: Johansson
authors.affiliation: Government Institute for Economic Research (VATT) and IZA, Finland. Electronic address: tuomas.pekkarinen@aalto.fi.
authors.forename: Tuomas
authors.initials: T
authors.lastname: Pekkarinen
authors.affiliation: Research Department, The Social Insurance Institution of Finland, Finland.
authors.forename: Jouko
authors.initials: J
authors.lastname: Verho
mesh_terms: D000328:Adult; D019973:Alcohol-Related Disorders / Q000191:economics* / Q000453:epidemiology / Q000401:mortality; D000434:Alcoholic Beverages / Q000191:economics*; D003132:Commerce / Q000191:economics / Q000706:statistics & numerical data; D003431:Cross-Cultural Comparison; D005260:Female; D005387:Finland / Q000453:epidemiology; D006291:Health Policy / Q000191:economics*; D006801:Humans; D038622:Internationality; D008297:Male; D008875:Middle Aged; D012042:Registries; D017678:Sex Distribution; D018582:Sick Leave / Q000191:economics* / Q000706:statistics & numerical data; D013548:Sweden / Q000453:epidemiology; D013660:Taxes / Q000191:economics*; D014195:Travel
keywords: Absenteeism; Alcohol taxes; Cross-border shopping; Health effects of alcohol; Mortality