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Abstract
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OBJECTIVE: This paper examines the association between alcohol excise tax rates and alcohol-related traffic accidents in Estonia.
METHODS: Monthly time series of traffic accidents involving drunken motor vehicle drivers from 1998 through 2013 were regressed on real average alcohol excise tax rates while controlling for changes in economic conditions and the traffic environment. Specifically, regression models with autoregressive integrated moving-average (ARIMA) errors were estimated, in order to deal with serial correlation in residuals. Counterfactual models were also estimated in order to check the robustness of the results, using the level of non-alcohol-related traffic accidents as a dependent variable.
RESULTS: A statistically significant (p<0.01) strong negative relationship between the real average alcohol excise tax rate and alcohol-related traffic accidents was disclosed under alternative model specifications. For instance: the regression model with ARIMA (0,1,1)(0,1,1) errors revealed that a 1 unit increase in the tax rate is associated with a 1.6% decrease in the level of accidents per 100,000 population involving drunken motor vehicle drivers. No similar association was found in the cases of counterfactual models for non-alcohol-related traffic accidents.
CONCLUSIONS: This paper indicates that the level of alcohol-related traffic accidents in Estonia has been affected by changes in real average alcohol excise taxes during the1998-2013 period. Therefore, in addition to other measures, the use of alcohol taxation is warranted as a policy instrument in tackling alcohol-related traffic accidents.
Language: en |