Treno, Andrew J.; Gruenwald, Paul J.; Wood, Darryl S.; and Ponicki, William R. (Oct 2006). "The Price of Alcohol: A Consideration of Contextual Factors." Alcoholism: Clinical and Experimental Research 30(10): 1–9.

Available at the website of Alcoholism: Clinical and Experimental Research

Methods: The core data for these analyses came from a telephone survey of Alaskan retail establishments licensed to serve alcohol. This survey utilized computer-assisted telephone interviewing (CATI) techniques to collect alcohol-pricing information from on-premise (i.e., establishments where alcohol is consumed at the point of purchase such as bars and restaurants) and off-premise (i.e., establishments such as grocery stores and convenience markets where consumption occurs in other locations) alcohol retailers throughout the state of Alaska. Price estimates were developed for each beverage-type based on alcohol content. Separate regression analyses were used to model each of the 8 price indices (on-premise and off-premise measures for beer, spirits, wine, and the average price across beverage types). All regressions also controlled for a set of zip-code level indicators of community economic and demographic characteristics based on census data.

Results: Outlet density per roadway mile was unrelated to price for both on- and off-premise establishments, either across or between beverage types. In contrast, overall distribution costs did appear to be related to alcohol price. The demographic and economic variables, as a group, were significantly related to observed prices.

Conclusions: More attention needs to be directed to the manner in which sellers and buyers behave relative to alcoholic beverages. Alcohol demand remains responsive to prices; yet, consumers have considerable latitude in determining the price that they pay for alcohol.