Women in the US who drink alcoholic beverages earn 14 percent more than nondrinkers and men who drink make 10 percent more than abstainers, according to an economic analysis published in the Journal of Labor Research. Men who drink in a bar at least once a month earn an additional 7 percent, for a total of 17 percent more than nondrinkers.
Research in several countries has found that those who drink alcohol earn more money. One explanation is that moderate drinking improves health, which in turn affects earnings (Hamilton and Hamilton, 1997).
The current study tested the idea that drinking increases social capital, which leads to greater income. Social capital refers to a person’s social characteristics, including social skills, charisma, number of friends and acquaintances, and other sociability factors that enable the person to reap both economic and non-economic returns from interactions with others.
There is strong evidence that social networks are important in finding jobs and earning promotions (Corcoran, 1980; Montgomery, 1991; Pulman, 2000). A large number of weak ties or friends-of-friends may be the most important factor in getting the best job and highest income (Granovetter, 1995).
If social drinking increases social capital, which increases income, then social drinking is a productive activity, report the researchers.
Moderate drinkers have the strongest social networks (Skog, 1980) and there is a negative relationship between social integration and abstinence (Leifman, et al). The researchers note that “Whether abstainers choose not to be as social or whether organizers of social functions involving drinking exclude abstainers in unclear. Abstainers may prefer to interact with other abstainers or less social people. Alternatively, abstainers might not be invited to social gatherings, work-related or otherwise because drinkers consider abstainers dull.”
It appears that people make more money because they drink. Research conducted by Dr. Pinka Chatterji of Harvard University and Dr. Jeffrey DeSimone of the University of South Florida demonstrates that higher income is not leading to drinking. That is, the larger proportion of higher income people who drink isn’t because they can afford to do so. Their research was funded by the National Institute on Alcohol Abuse and alcoholism (NIAAA).
Of course, there can be too much of a good thing. The economic advantage associated with drinking is eliminated when consumption exceeds 35 drinks per week.
Filed Under: Alcohol Economics