THE ECONOMIC DETERMINANTS OF ALCOHOL CONSUMPTION*

Abstract

In this paper is presented an analysis of the consumption patterns of beer, wine and spirits for Australia using data for the period 1955/56‐1985/86. The validity of the demand theory hypotheses demand homogeneity and Slutsky symmetry has been tested using recently developed distribution? free procedures. The findings were that (i) beer and wine were necessities and spirits a strong luxury; (ii) beer and spirits are specific complements; and (iii) the homogeneity and symmetry hypotheses are acceptable. Preference for wine consumption seems to be independent of preference for beer and spirits.