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Published on: January 7, 2019
Alcohol, tobacco and public policy: the contribution of economics
Abstract:
This article shows the contribution of economics to debates about prevention policy. The arguments used by various pressure groups favouring or opposing more effective prevention policies need to be subject to critical scrutiny and empirical testing. The market failure case for state intervention in alcohol and tobacco markets is assessed and an alternative public choice approach is outlined. The supply side of the market in the form of the alcohol and tobacco industries is analysed using a structure-performance framework. Consideration is given to how firms might respond to prevention policies through, say, lobbying or shifting higher taxes to suppliers or by diversifying into new markets.
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