Abstract
The article is based on a regression analysis made on panel data concerning the changes in Danish household purchases of beer and wine between 1990 and 1993, following two major price reductions made in 1991 and 1992. The results show that the attempts to reduce cross-border shopping have been fruitful: the amounts of beer and wine bought abroad have decreased markedly, except in the southern parts of the country, near the German border, where cross-border shopping is a part of daily life. The price reductions have also resulted in increasing sales figures, although some of these changes are due to a common shift from spirits to weaker alternatives. The panel data also show an increased demand for inexpensive beer and wine bought in Denmark. Together with reduced cross-border shopping this means that some of the most price-elastic trade with beer and wine has moved home from abroad.
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