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Factors Affecting Alcohol Purchase Decisions and Expenditures: A Sample Selection Analysis by Ethnicity in Malaysia

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Abstract

Heckman’s sample selection model was applied to data from the Malaysian Household Expenditure Survey 2004/2005 to examine the factors influencing the likelihood of purchasing and the amount spent on alcohol in Malaysia. Results of the marginal effects suggest that while socio-demographic factors are important determinants of household purchase decisions and expenditure levels on alcohol in Malaysia, the effects vary across ethnic groups. Specifically, although education had a significant but modest impact in reducing the probability of alcohol purchases and expenditure levels among ethnic Chinese households, this effect was not evident among the ethnic Indians and other races. While increasing household size lowered the likelihood of purchasing alcohol and its expenditure levels for all ethnic groups, the reinforcing effects of both income and gender were relevant only for ethnic Chinese and Indian households. Last, urban Indian households were less likely to purchase alcohol and spend less compared to rural Indian households.

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Notes

  1. As of December 2008, the exchange rate was approximately US $1.00 = RM3.55 or RM1.00 = US $0.28.

  2. A comprehensive discussion of the characteristics of the respondents can be obtained from the authors.

  3. Parameter estimates for all samples are available upon request.

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Acknowledgement

Research support from the Universiti Sains Malaysia short-term grant (304/PSOSIAL/637038) is acknowledged.

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Authors and Affiliations

  1. School of Social Sciences, Universiti Sains Malaysia, 11800, Penang, Malaysia

    Andrew K. G. Tan

  2. Department of Agricultural Economics, The University of Tennessee, Knoxville, TN, 37996-4518, USA

    Steven T. Yen

  3. Department of Agricultural Economics and Agribusiness, University of Arkansas, Fayetteville, AR, 72701, USA

    Rodolfo M. Nayga Jr.

Authors
  1. Andrew K. G. Tan
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  2. Steven T. Yen
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  3. Rodolfo M. Nayga Jr.
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Correspondence to Steven T. Yen.

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Tan, A.K.G., Yen, S.T. & Nayga, R.M. Factors Affecting Alcohol Purchase Decisions and Expenditures: A Sample Selection Analysis by Ethnicity in Malaysia. J Fam Econ Iss 30, 149–159 (2009). https://doi.org/10.1007/s10834-009-9148-9

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  • DOI: https://doi.org/10.1007/s10834-009-9148-9

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