10 thoughts on “Thinking about drinking”

  1. Posted 17/03/2009 at 11:20 | Permalink

    It would be interesting to plot a proper price-quantity chart for the various European countries, which have wildly different alcohol prices and well documented consumption rates.

    I’d guess that the demand curve is almost vertical, which, as much as I hate to say it, is a good reason for taxing alcohol very highly.

  2. Posted 17/03/2009 at 11:20 | Permalink

    It would be interesting to plot a proper price-quantity chart for the various European countries, which have wildly different alcohol prices and well documented consumption rates.

    I’d guess that the demand curve is almost vertical, which, as much as I hate to say it, is a good reason for taxing alcohol very highly.

  3. Posted 17/03/2009 at 11:28 | Permalink

    I wonder whether alcoholics will turn to crime if they can no longer afford to pay for their habit out of their benefits. A minimum price of 50p a unit will raise the price of a 2 litre bottle of super-strength cider from about £3 to about £9. If they drink one bottle a day this will use up all their Job Seeker’s Allowance, though if they are on Incapacity Benefit they might have a few pounds spare for food, heating and water.

  4. Posted 17/03/2009 at 11:28 | Permalink

    I wonder whether alcoholics will turn to crime if they can no longer afford to pay for their habit out of their benefits. A minimum price of 50p a unit will raise the price of a 2 litre bottle of super-strength cider from about £3 to about £9. If they drink one bottle a day this will use up all their Job Seeker’s Allowance, though if they are on Incapacity Benefit they might have a few pounds spare for food, heating and water.

  5. Posted 17/03/2009 at 11:34 | Permalink

    2 proposals:
    -On ‘targeting’ those who consume the cheapest form of alcohol, why not just lower the overall rate of alcohol taxes substantially? Why would people buy cheap cider that tastes like vinegar if you could get a good one at a reasonable price?
    -On hospitalisation costs, why not introduce a substantial co-payment on the treatment cost of self-inflicted injuries, payable in installments?

  6. Posted 17/03/2009 at 11:34 | Permalink

    2 proposals:
    -On ‘targeting’ those who consume the cheapest form of alcohol, why not just lower the overall rate of alcohol taxes substantially? Why would people buy cheap cider that tastes like vinegar if you could get a good one at a reasonable price?
    -On hospitalisation costs, why not introduce a substantial co-payment on the treatment cost of self-inflicted injuries, payable in installments?

  7. Posted 17/03/2009 at 13:16 | Permalink

    Of course, tobacco and alcohol are taxed because they are price inelastic in general. This helps increase the revenue yield. But then governments come along and start arguing the opposite when it suits them – that raising the price of alcohol and tobacco can be important in reducing consumption.

  8. Posted 17/03/2009 at 13:16 | Permalink

    Of course, tobacco and alcohol are taxed because they are price inelastic in general. This helps increase the revenue yield. But then governments come along and start arguing the opposite when it suits them – that raising the price of alcohol and tobacco can be important in reducing consumption.

  9. Posted 29/03/2009 at 08:51 | Permalink

    I agree with one of the discussants. Higher price of alcohol will cause more tax benefits and illegal imports, lower price may stimulate alcoholism. As double-edged scissors, one is to be careful implementing these measures in both directions of price change, with implementation of one of them depending on current governments needs and market sustainability.

  10. Posted 29/03/2009 at 08:51 | Permalink

    I agree with one of the discussants. Higher price of alcohol will cause more tax benefits and illegal imports, lower price may stimulate alcoholism. As double-edged scissors, one is to be careful implementing these measures in both directions of price change, with implementation of one of them depending on current governments needs and market sustainability.

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