Scotland to impose minimum price on alcohol

Measures to tackle alcohol abuse by stopping cut-price offers have been outlined by the Scottish Government. It has proposed a range of measures including the radical step of a minimum price per unit. It would be the first country in Europe to take the step. The details of the price to be set will be worked out with economists to find the most effective level. The blueprint said the amount of advertising by supermarkets over recent months suggested that cheap alcohol did play a key role in determining where people shop. Health Secretary Nicola Sturgeon said: "Plummeting prices and aggressive promotion have led to a surge in consumption, causing and adding to health problems ranging from liver and heart diseases to diabetes, obesity, dementia and cancers.

However, the proposals have not been universally welcomed. Fiona Moriary, director of the Scottish Retail Consortium, said the plans would add costs to responsible shoppers without making any difference to irresponsible drinking. She said: "Irresponsible drinking is not about price or availability yet this is the main focus of the government's approach. We need to develop solutions that educate rather than alienate, instead the government has retreated to its bunker and is neither listening to the evidence presented nor willing to tackle these issues in a consensual manner." The Portman Group, an alcohol industry body which promotes responsible drinking, said the government was not listening to reason. Chief executive David Poley said: "People who drink to get drunk would not be influenced by these measures

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Do you think setting a minimum price for alcohol will reduce consumption? What factors will determine its success?

What externalties ar associated with excess drinking? Even if price controls don't reduce consumption is it something that could have benficial effects?

IEA says world needs energy ‘revolution’

The world needs to spend $45,000bn on green technologies in the next 40 years, or 1.1 per cent of annual global economic output, to halve greenhouse gas emissions by 2050, the International Energy Agency said. The investment – much of it needed to accelerate development of new technologies such as hydrogen fuel cells and carbon storage – is roughly equivalent to the gross domestic product of Italy, though the IEA said it represented “a re-direction of economic activity and employment, and not necessarily a reduction of GDP”. (FT article)

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Huge rise in alcohol related admissions

The Guardian reported that the number of people admitted to hospital in England due to drinking alcohol has more than doubled in the past 12 years, NHS figures revealed today. In 2006-07, 207,800 people were admitted to hospital because of their drinking. This included people who were drunk, had liver cirrhosis or an alcohol-related illness such as heart disease, as well as those injured or assaulted while drunk. This is more than double the amount in 1995-96, when 93,459 people were admitted to hospital, and a 7% rise on the 193,637 admissions in 2005-06. Almost one in 10 (4,888) of those admitted to hospital last year were children under 18, the study, by the NHS Information Centre for health and social care, found.

This is a good example of negative externalties and the report highlights the strain that this increase on alcohol-related admissions is putting on the NHS.

What could be done to reduce the number of alcohol-related admissions to hospital? Would increased taxation reduce alcohol consumption? Should supermarkets be prevented form offering alcohol at discounted prices?

Aviation policy should be rethought

The government should completely rethink its aviation policy and shelve plans to expand Heathrow and Stansted airports, according to an influential advisory body.The Sustainable Development Commission, chaired by Sir Jonathon Porritt, said there were big question marks over the environmental and economic arguments underpinning the proposals for British airport expansion. It warned that the government faced a wave of legal challenges if it did not hold an independent review of its 2003 aviation white paper, which sanctioned new runways at Heathrow, Stansted and other airports. It believes that a full cost benefit study should be undertaken to consider the full implications of the expansion of air travel. Read further details.

A good example of an economic activity with many private benefits but also numerous external costs (ask those people who live near an airport - I am one of them!)