Monday, July 09, 2007

The High Cost of Smoking

In the article, The High Cost of Smoking by Hilary Smith, the author presented many actual costs and opportunity costs accumulated by smokers. While I agree that these costs are real, the author missed one important factor; enjoyment!

While I agree there are many costs associated with smoking, and often the burden is shared by society as a whole, the author did not answer the most important question. Why do people smoke? As with any choice in life or business, an individual weighs the cost verses the gain. While many people who don't smoke can't understand how the cost cannot be higher than what little enjoyment a person might derive from smoking, I am sure a smoker would tell you the opposite. Therefore, my question is this; how can you calculate the cost of smoking if you do not place a value on the pleasure a person gets from this habit? Another example would be the cost of an additional big mac to a morbidly obese individual or the cost of another drink to an alcoholic.


Greg Delemeester said...

Interesting question. Economists distinguish between two types of costs: private costs and external costs. Private costs are borne by the individual smoker and fall into two categories--short term and long term. In the short term, the price of a pack of cigarettes (which represents the opportunity cost)is the most important. In the long term, the adverse health consequences represent the most important costs. In terms of benefits, I would argue that most benefits occur in the short term (e.g., the nicotine buzz, the calming effect, or the social aspects of smoking) and smokers tend to ignore the long term health consequences of their behavior.

External costs are costs that are imposed on non-smokers--this is the standard second-hand smoke argument. It's argued that smokers do not take in consideration the potential damage they're imposing on non-smokers. Thus, from society 's point-of-view, there may be too much smoking going on. That's why some have called for increased cigarette taxes in order to discourage excess smoking.

Penny S. Jenkins said...

The State of Ohio has instituted approximately three tax increases in the last ten years. I agree some people will stop smoking if a pack of cigarettes equals $X (the maximum price each individual is willing to pay); however, the State tends to introduce these new tax increases incrementally so that the cash register effect is minimal and the smokers $X rises.

If the price of cigarettes can actually stop someone from smoking, then the tax increase must be substantial and immediate. Let's face it...if smokers were interested in their health or anybody else's, they probably would have never started smoking to begin with!

Adam Esparza said...

I agree with Penny. Smokers are going to buy those cigarettes no matter what the price. It's a habit that is tough to break and i have noticed friends who were discouraged by the raising of prices but in the end they found a way to pay for it. Plus with Ohio there has been an increase in minimum wage therefore allowing more individuals to account for the price increase of cigs.

Greg Delemeester said...

[This comment is by Chunzi.]

If the cost of smoking can’t be higher than what little enjoyment a person might derive, then I would say that the cost of healthy body can’t be higher than a life which is not spending time on staying in hospital. If the cost of smoking is that moment of enjoy, then what about the cost of a sick body which is destroyed by smoking? The fee of staying in hospital and medicine is one of the most expensive cost on earth so far as I know. Although I’m not a smoker and I can’t understand how enjoyable when a person is smoking is, I do know that hospital and doctors can make you bankrupt! And the cost of staying in hospital or having a sick body is losing jobs and salary that a person should have gotten by his/her regular work time. One word: the cost of smoking is much higher than anything else!