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The Costs of Poor Health Habits.

The costs imposed on society by individuals' poor health habits are a major cause of government concern and are stimulating interest in the question of how government can discourage behavior that impairs health and shortens life. In The Costs of Poor Health Habits, Manning and colleagues attempt to present detailed analyses of the external costs of smoking, excessive drinking, and sedentary lifestyles; that is, "what smokers cost nonsmokers, what heavy drinkers cost abstainers or moderate drinkers, and what voluntarily inactive people cost those who exercise regularly." Once determined, the authors say that these costs can be used to estimate appropriate levels of taxes, at least on cigarettes and alcohol.

The first chapter presents a nontechnical overview of the issues; estimates the external costs of smoking, drinking, and inactivity; and considers what determines those costs and what can be done to reduce them. The remainder of the book contains more detailed results not reported in the overview chapter and is intended for researchers interested in the authors' concepts, assumptions, data, and methods. There are also eight appendices that include technical material such as statistical methods, literature reviews, and data source comparisons.

The authors make a clear distinction between internal and external costs of various behaviors. Internal costs, not analyzed in this book, are those borne directly by the victims and their families, and include lost wages, direct payment of medical costs, disability, and premature death. The authors analyze only external costs such as collectively financed programs and taxes on earnings, as well as costs due to the effects of passive smoking and to the property damage and loss of innocent lives caused by drunk-driving accidents and other alcohol-related crimes.

Costs of smoking and drinking

It is hardly debatable that cigarette smoking and excessive use of alcohol impose costs on society. The authors have done exceedingly careful analyses of these issues and conclude that the net external cost of smoking amounts to 15 cents per pack even when cost savings due to early smoking-related deaths are factored in. They acknowledge that their conclusion about the precise cost must remain somewhat uncertain because of uncertainty about what discount rate to use in a situation where "smokers' costs come early in life whereas the 'gains' to nonsmokers of lower pensions and Medicare come late in life."A second problem affecting the calculation is the strength of the causal relationship between smoking and associated costs. Using assumptions at the extremes, the per-pack cost could be as high as 28 cents or as low as 4 cents. The authors have adopted the middies-of-the-range estimate.

With respect to heavy drinking, the estimated external cost of excess drinking is about 54 cents per typical drink. But, because one cannot restrict taxes to excess drinks only, the total cost fails to 22 cents per drink. The authors indicate that the validity of their estimate depends on the dollar value assigned to innocent lives lost because of alcohol and on the extent of underreporting of alcohol consumption (they present compelling evidence that self-reported consumption of alcohol accounts for only 40 to 60 percent of actual consumption.) They estimate the value of a lost life at $1.67 million, based on the prior work of Shepard and Zeckhauser ("Survival versus Consumption," Management Science 30 (1984): 423-439). Other assumptions would, of course, yield different estimates of external costs. The authors believe that their estimates tend toward the low end of the spectrum.

What conclusions do the authors draw from their analyses? They focus almost exclusively on economic strategies--particularly taxation--to encourage decreased consumption of cigarettes and alcohol. They clearly favor increasing taxes on heavy drinking very substantially, both to discourage consumption and to require drinkers to pay their fair share of the costs they impose on others. Of course, all drinkers would be taxed, but heavy drinkers would bear most of the burden.

As for smoking, cigarette taxes already exceed the external costs they impose, but increases can be justified on several other grounds, particularly that of discouraging adolescents from starting to smoke--a benefit most of them will probably later appreciate. Although studies of price and income elasticity of demand for cigarettes and alcohol give a rather bewildering and mixed set of conclusions, the reported effects of increased taxes are generally favorable, if small.

What price indolence?

Because the relationships between smoking and health and between heavy drinking and health are relatively clear and widely accepted, government intervention to discourage these behaviors can be justified as a public health measure aimed at protecting society against assaults on the health and economic welfare of its citizens. However, when we consider the external costs of lack of exercise, the situation is not nearly as clear.

Are heavy exercisers inherently healthier than sedentary people? Are people with chronic diseases or physical limitations less likely to exercise and more likely to obtain medical care? Are they more likely to die younger? Which is cause and which is effect? Or is the relationship between exercise and health outcomes a spurious one caused by a combination of other variables? The authors attempt to reduce uncertainty about these issues by drawing from a number of studies that, unfortunately, yield mixed results--exercise sometimes correlates with reduced use of medical services, sometimes not.

Employing a variety of methods and data sets, they ultimately conclude that "At a discount rate of 5 percent, lifetime costs of relatively sedentary people are $1,650, a figure greater than the cost of smokers ($1,000), but less than that of drinkers ($42,000)."

The authors state that they are less confident about their exercise results than about the drinking and smoking results because of greater uncertainties about the effects of exercise, the problem of reverse causality, and less complete data about exercise. I would add that their narrow focus on economic considerations fails to take into account the critical issue of how people use time that might otherwise be spent exercising. In fact, the conclusion I derive from the authors' analysis is that the question is too complex to reduce to a simple monetary equation.

The Costs of Poor Health Habits is a good book as far as it goes. However, the authors' focus on economic sanctions may draw attention away from primary prevention of poor health habits. Children are susceptible to entreaties to use cigarettes and alcohol; taxing those products will not affect the early development of relevant attitudes and desires. If society delays dealing with tobacco and alcohol until young people are ready to buy them, we begin with two strikes against us.

Smoking and heavy drinking are to a large extent learned behaviors. If behavior is learned, it can be prevented. But to do so, we must intervene with children before they have learned to value and experiment with cigarettes and alcohol. Comprehensive health education programs must be initiated no later than the beginning of school age to provide knowledge of the consequences of smoking and heavy drinking and to teach skills that enable children to refuse subsequent pressures to smoke and drink. If such information can be taught early enough in life, it may prevent, or at least delay, the onset of addictive behavior later in life. In addition, because most professionals believe that regular exercise confers benefits on the individual, even though they may not yet be quantifiable, it seems desirable to incorporate regular physical activity into school health-education programs in order to develop the exercise habit early in life.

Of course, changing societal norms are also reinforcing health promotion by placing an ever-increasing value on a smoke-free society and on moderation in drinking. These developments, and improved health education among very young children, along with economic incentives such as those recommended by the authors, should lead to far greater and more rapid improvements in behavior than would reliance on any one strategy.

Irwin M. Rosenstock is Professor Emeritus in the School of Public Health, University of Michigan, and in the College of Health and Human Services, California State University, Long Beach. He is a member of the Board on Health Promotion and Disease Prevention of the Institute of Medicine.
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Author:Rosenstock, Irving M.
Publication:Issues in Science and Technology
Article Type:Book Review
Date:Mar 22, 1993
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