Stronger Drinks in Your Supermarket : The Effects of Retail Deregulation on Alcohol Sales in Finland

In June 2024, Finland relaxed its retail alcohol sales restrictions, allowing sales of products with an alcohol by volume strength of up to 8% to be sold in grocery stores. Previously, the upper limit had been 5.5%. This thesis uses sales data from the two largest retailers in Finland and the Finnish and Swedish state alcohol monopoly companies to measure the effect this reform had on retail alcohol sales in Finland. In a differences-in-differences framework, I find no significant effect on total alcohol retail sales, excluding spirits, following the reform. I also find that the consumption of mild products, like beers and ciders, decreased while the sales of wines increased. Descriptive analyses show that the reform was associated with a substantial increase in sales of the products that became grocery-eligible, but this was offset by an equally large decrease in sales of other products. Alcohol sales also shifted from the state monopoly to private grocery stores following the reform. The aggregate null result is consistent with earlier studies in the Finnish context, but is an outlier when compared to research done internationally on alcohol sales restrictions.