Friday, 16 March 2012
"Students were happy to pay higher prices for the same number of drinks, and would simply buy more if the strength of the alcohol was reduced."
Increasing the cost of alcohol won't be enough to combat youth binge-drinking, says AUT Associate Professor of Retailing Andrew Parsons.
In a local study in to the effects of price and alcohol content on purchase behaviour, researchers at AUT looked at how much money Australian and New Zealand students were prepared to pay for alcohol. The literature study suggests that consumption is an accepted social norm, and that many young people deliberately drink to reach a level of intoxication. Current public policies to reduce this consumption, beyond education through media campaigns, include taxation to raise the price and movements to limit the allowable alcohol content in some beverages popular with youth.
The experiment, which was analysed as part of the thesis of AUT Master of Business student Nicola Stephenson, was conducted in both Australia and New Zealand to examine the effects of price changes and alcohol content changes on behavioral intention.
The results suggest that social norms are stronger than price effects in both countries, and that alcohol content has a significant effect in New Zealand. Students were happy to pay higher prices for the same number of drinks, and would simply buy more if the strength of the alcohol was reduced. In fact, even when the cost was increased by up to 25 per cent, there was still no significant change in buying behaviour.
These findings contradict government emphases on fiscal and regulatory approaches to modify purchase behaviour. Parsons suggests taxation on alcohol, as currently being considered by the government, would have to be unusually high for it to actually put young people off buying alcohol.
For more information on this study, please contact Associate Professor Andrew Parsons.
Editor's Note: Original news release can be found here.