DETERMINANTS OF HOUSEHOLD EXPENDITURES ON ALCOHOL

This paper examines the determinants of household alcohol expenditures by using a nonnormal and heteroscedastic double-hurdle model to accom modate zero observations in the sample. The model is a generalization of the double-hurdle model estimated in previous studies of alcohol co nsumption, We also examine the effects of explanatory variables by cal culating and decomposing the elasticities, Findings support the use of a more generalized error distribution, Income, region, education, and household demographics are among the significant determinants of alco hol expenditures.