Publication Date
8-2013
Recommended Citation
Levy, Amnon, Would a rational underage binge-drink?, Department of Economics, University of Wollongong, Working Paper 13-03, 2013, 12.
https://ro.uow.edu.au/commwkpapers/333
Abstract
This paper provides a utility-based definition of binge drinking and examines the compatibility of this phenomenon with rational decision making. Prohibition of young people’s consumption of alcohol is frequently violated with binge-drinking in groups. The analysis considers the roles of peer-pressure, full price of alcohol and crowding in underage group-drinking sessions and identifies the conditions for binge-drinking by expected utility maximizing members. Rational binge-drinking occurs when the impact of the peer-pressure on the individual member’s utility exceeds the loss of utility from the forgone spending on all other goods associated with the expected full marginal cost of consuming alcohol.