Using the estimates derived from models accounting for addiction, Grossman and colleagues (1998) predicted the effects of changes in beer taxes on consumption. For example, the investigators examined the effects of a tax increase that would have matched the taxes on the alcohol in beer to those on the alcohol in distilled spirits in 1951 and then accounted for the rate of inflation since 1951. Such an increase was estimated to have reduced average consumption by more than 40 percent in 1982 and 1983 (the middle years of the sample).
