Wednesday, 21 November 2012

Poor consumption decisions lead to poor health


Today there is news that in the UK deaths from liver disease has risen by 20%. Is this a surprise? Yes, because in the rest of Europe deaths from the same cause have fallen by 20%!

The cause of liver failure is usuall either drinking too much, being overweight or having a poor diet. Of course hepatitis, which is an infection, can also cause liver failure.

From our point of view this is another example of market failure. It is caused by consumers failing to take into account the full information available about the goods they consume.

There are three different failures identified here, but all have a similar cause. Lack of information, or demerit goods, are over-consumed compared to optimal levels.

In the case of alcohol there is already a high tax, but a minimum price per unit of alcohol will soon be considered by the government in an attempt to reduce binge drinking. As for poor diet and over-eating the question about how to tackle this remains unresolved.

What is certain is that more education will help in all three cases and stories like the one in The Guardian below needs to be taken seriously.

13 comments:

  1. I disagree with Dame Sally Davies (Guardian article) that the NHS should make preventing, detecting and treating liver disease a priority if it has been caused by excessive drinking. The NHS is forced to spend money helping those who could have avoided their infliction had they been more aware or just had a better self-preservation. They have a restricted budget, which means that the NHS is therefore less able to help others who have unavoidable or accidental aliments. It is still important that they do try and help these people, but it should not be there priority.
    If the government put in place a floor price then that would hopefully decrease the alcohol demanded. Also they should reduce the air time for alcoholic drinks and fast food advertisements and consider replacing them with health awareness and drink driving warnings. Raising awareness would hopefully reduce the number of liver problems caused by poor diet and alcohol.

    -Georgina Davis

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  2. I feel as though the NHS are reluctantly having to spend the hard earned money of tax payers on helping those who drink until they are nearly dead. I can guarantee most of those who do end up in an NHS hospital from liver damage will have been buying the alcohol with their benefifts money. I agree with the idea of putting a set price per unit, and advertising the risks and likely consequences of choosing to drink and eat excessively. I don't think alcohol is a major demerit good, however there are many foods out there (fast foods) which do far more damage than people actually think. Advertising and investing money in the NHS to show liver damage early on to these selfish people to act as a wake-up call, I feel, would be the most effective method

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  3. I think the most efficient way to reduce the amount of people from dying liver disease is to educate the young generation the negative effect of smoking and drinking alcohol.They should drink alcohol in a sensible way but not over drunk. The government could set a minimum price for tobacco products or advertise the negative side of smoking to increase people's awareness. Therefore the people might consume less alcohol drinks and tobacco products. Also, the government could introduce some scheme to attract more people to quit smoking in early age, by introduce them to do more exercise or make use of their leisure time to so something else rather than smoking or drinking alcohol.

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  4. Since over-production occurs, deadweight loss happens and firms will not gain as much profit as they could. Government intervention maybe needed and surely some of them are not economically concerned; that is why I personally think perhaps real life education is more supportive.

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  5. People, like Dame Davies, should remember that there is enough stress on the NHS as it is budget-wise. It is true that prevention is better than cure, and a precautionary approach is better than remedial; it could also save money in the long run. However, there could be other factors which could be causing these increasing figures such as stress. There is also no guarantee that a price floor would be effective: it might lower drinking, however some people might just resort to cheaper goods i.e. teenagers. There's no telling if the quality of alcohol would have an effect on these figures.

    - Cristyn Nartey

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  6. of course the best way to save the NHS money in the long run would be to educate the population on the risks and such of consuming certain types of goods. And as Alex suggested, it is probably time that the Government stepped in to do this. I agree with Dame Davies that treating these people should be a priority. As the cause of liver failure is usually drinking too much, being overweight or having a poor diet and as this is an example of market failure, should these people really be held fully responsible for their illness? The least we could do is help them recover, and make sure that it is less likely to happen at such a high rate again. We should look towards the other European countries whose rates have fallen and see what they've been doing to combat the problem.

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  7. I think for the NHS to put even more funds into the treatment of alcohol related liver diseases is a lost cause. Their budget is pressed as it is. The problem is not that they are not giving enough money but that the cases are ever increasing. On the packet of a cigarette box it may things like 'smoking kills' but when it comes to consumer taste the consumer already aware of the risks may choose to do it anyway. There are no such warnings on alcohol bottles - do alcohol companies need to put a diseased liver image up on the side of a vodka bottle- perhaps. However for those who already binge drink or smoke excessively it is much more economically inefficient (use of resources high in rehabilitation etc..) so targeting the education systems and the younger generation is the most feasible start. Prevention is better than cure.
    (DEP I.B) Chanel Sangster

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  8. It is quite sad to hear that in the UK deaths from liver disease has risen by 20% while in the rest of Europe deaths from the same cause have fallen by 20%. Since this disease is preventable, the government can truly do something in order to stop the rising death rate. To me, the government not only should apply the minimum price for alcohol, but also educate the public. I think these are the most effective method to tackle the problem. Applying the minimum price can restrict some people from consuming alcohols, while on the other hand, educating the public, for example, promoting the disadvantages of drinking and the consequence of getting drunk, can make the public lessen their yearning for drinking. Thus, the demand for alcohols will decrease. With less demand and less quantity transacted, the people getting liver disease will decrease. The problem of the increasing death rate caused by liver disease can be resolved.

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  9. In order to reduce the spending on treating disease which caused by poor consumption of food, I think the government should focus on educating people about the important of health as well as how to eat can be more healthy. I think this is the most sustainable way to solve the problem.
    Christy

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  10. I do agree that educating people will help to try and reduce binge drinking. However I don't think that a lack of information is the problem. Many know or have known people who spend endless amounts of money on alcohol and damage their bodies consuming it in large quantities. In some ways that is the information. Yet people still do it. I think we need to be educated on how to deal with this information or show people more serious and maybe extreme cases. This education I think should come from guardians. If guardians are binge drinking and eating takeaways every night, then as a child you will most likely see this as normal and will do the same. This will then be passed on to your children and so on. There needs to be examples of more serious cases to do with binge drinking and obesity, such as liver failure, shown to young adults to help them understand the consequences that they were not aware of.

    Arthur Elmes

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  11. I agree with the previous comment to a certain extent. By publicising the negative repercussions of a poorly balanced diet through campaigns and advertising the Government can affect consumer tastes. Further information about the hazards of smoking and drinking over abundantly would encourage more sensible buying and thus reduce the levels of diseases. Perhaps enhancing the knowledge of these problems in the younger generation would be the key to maintaining health levels in the future. In addition, the Government could increase tax on products like tobacco resulting in an increase in price, and a decrease in demand.

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  12. I think that the idea of a minimum price of 50p per unit of alcohol is completely ridiculous. Not only is this going to price out responsible drinkers on a low income from enjoying a cheeky glass of wine every now and again but it is going to mean that the average can of beer could cost in excess of £4.00. This is a price few people are going to be willinng to pay and I imagine the producers of alcohol will be unhappy with this price rise as well. The price rise will cause a decrease in demand and therefore the producers are going to lose out. The government would have to subsidise the alcohol producers and the money they spend doing this could be better spent on an intensive anti-alcohol campaign. Trying to educate the population about the dangers of alcohol is more likely to prevent an increase in liver damage and ultimately save money on the NHS. Everyone is a winner, the consumer can still afford to drink, demand will not be affected as much and the NHS will save money.

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  13. The recent figures are tragic, but not particularly shocking. As much as the government believe financial sanctions on alcohol will be effective, all this will do is influence moderate drinkers to cut back, yet cause those who are addicted to divide their income in such a way which will enable them to cut back on spending as much in essential areas so that they have enough to carry on feeding their addiction. Demand for such goods will therefore decrease, but only slightly which will not do enough to solve the problem. I agree with the first comment and feel that instead of constantly throwing cheap fast food deals in our faces through different means of advertisement, to simply raise awareness of the harmful long term effects these demerit goods have.

    - Abby Ashmead

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