Abstract

BACKGROUND: Studies have found a positive effect of low/moderate alcohol consumption on wages. This has often been explained by referring to epidemiological research showing that alcohol has protective effects on certain diseases, i.e., the health link is normally justified using selected epidemiological information. Few papers have tested this link between alcohol and health explicitly, including all diseases where alcohol has been shown to have either a protective or a detrimental effect. AIM: Based on the full epidemiological information, we study the effect of low alcohol consumption on health, in order to determine if it is reasonable to explain the positive effect of low consumption on wages using the epidemiological literature. METHODS: We apply a non-econometrical cost-of-illness approach to calculate the medical care cost and episodes attributable to low alcohol consumption. RESULTS: Low alcohol consumption carries a net cost for medical care and there is a net benefit only for the oldest age group (80+). Low alcohol consumption also causes more episodes in medical care then what is saved, although inpatient care for women and older men show savings. CONCLUSION: Using health as an explanation in the alcohol-wage literature appears invalid when applying the full epidemiological information instead of selected information.