Alcohol Consumption Decisions in Korea

Abstract

Data from the 1996 Korean Household Panel Study and a double hurdle model were used to analyze alcohol consumption decisions in Korea. Research findings suggest that the Korean most likely to purchase alcoholic beverages is a young male with a college degree. Among those who drink, higher levels of alcohol consumption were associated with being older, male, self-employed or a farm or fishery worker while lower levels of alcohol consumption were associated with higher levels of education. The results of this research underscore the importance of using a two-step approach to alcohol consumption modeling. Parameter estimates of the double-hurdle model show that the effect of age, education level and occupation of the respondent was different in each decision step. Thus, this approach provided more information than the Tobit model would have provided regarding the unique role of each variable in the participation and consumption decisions. This additional information may be valuable for understanding consumer behavior in the alcoholic beverages market and for developing public awareness programs. The findings for gender and education were generally similar to those of studies using U.S. or Canadian data on alcohol consumption. The role of household level economic factors, family composition, and residence in alcohol consumption decisions appears to differ across cultures, however. Given differences found in this analysis and analyses using data from Western nations, it is clear that Korea will need to develop its own approach to segmenting the alcohol market for marketing or policy.