BSB113 Economics RESEARCH REPORT

Word Count: 1247

Table of Contents

1.0 Introduction………………………………………………………………...……3
2.0 Setting the context ...………………………………………………………......3
3.0 A description of the relevant economic model...…………………………….5
4.0 A critical analysis of the key arguments……………………………………...6
4.1 Alcopops tax…………………….…………….…………….…………......6
4.2 Minimum pricing policy …………….…………….…………….…………7
4.3 Non-pricing policy…………….…………….…………….……….……….7
5.0 Conclusion...…………………………………………………………….……….8
6.0 Reference List……………………………………………………………….…..9

1.0 Introduction

This report aims to cover the effectiveness of an alcopops tax in relation to deterring youth binge drinking in Australia. Reducing the levels of drinking, harmful drinking and alcohol problems among young people is crucial from economic and societal perspectives (Araoz, 2012). Therefore, it is important to contextualise youth binge drinking. Additionally, taking this a step further by presenting and describing an economic model, which illustrates a tax on producers bringing alcohol levels to a socially efficient consumption. Lastly, critically analysing strengths and limitations of an alternative pricing policy (minimum price) and non-pricing policy, which have been successful.

2.0 Setting the context

The term 'binge drinking' generally refers to drinking heavily over a short period of time with the intention of becoming intoxicated, leading to various costs from an economic and societal perspective (Anderson, 2008). Negative social costs underlying youth binge drinking in Australia include interpersonal violence, drunk driving and lost economic productivity (NIAAA, 2000). Therefore, much of the burden of such problems is initially born by first response and public emergency services (Collins & Lapsley 2002). Figure 1 clearly reflects this, showing 3,000 hospitalisations