To what extent does excise tax lower alcohol consumption?

This work considers the influence of excise tax on alcohol and the consumption of various kinds of alcoholic beverages. The focus is an area of the European Union between the years 1990-2009. The analysis uses fixed effects and first differencing. The results show that the growth in tax on spirits of 36 euros from the minimum (3 euros) to the maximum rate (39 euros) leads to a decrease in consumption of spirits by 24% and consumption of ethyl alcohol by 10%. If the intermediate products tax of 5 euros grows from the minimum rate (0 euro) to the maximum rate (5 euros), the consumption of ethyl alcohol will decrease by 12% and consumption of spirits by 21%. The growth in tax on wine of 5 euros from a minimum rate (0 euro) to the maximum rate (5 euros) leads to a decline in consumption of wine by 8.4%. The growth in tax on beer of 3 euros from a minimum rate (0 euro) to the maximum rate (3 euros) leads to an increase in consumption of spirits by 6.8% and consumption of wine by 86%, which means that spirits and beer and wine and beer are substitutes. The growth in real GDP per capita of 4100 euros leads to increased consumption of different types of alcoholic beverages by 3,7-9%