Relationship between Alcoholism and Economic Costs - Essay Example

Relationship between Alcoholism and Economic Costs Even though the concept “alcoholism” may appear more psychological, several studies have associated this to significant economic cost both to the drinker and the society. The studies use a supporting definition that alcohol abuse is as a result of cost generating aspect of alcohol consumption (Carpenter & Dobkin, 2009, 168). They estimate these cost in terms of various significant fields such as health, productivity, accidents and alcohol related crimes. In which case, health care cost, productivity losses, accident cost and alcohol related crime cost are the most prolific in these cases. All this insinuates that every government should put as much efforts in imposing stringent strategies that can reduce alcoholism in the society since it has significant impact on the economic state of a country. Imposing a government policy, which increases the age limit, for alcohol consumption, should be considered a successful way of significantly reducing these economic costs. This essay provides an allegory of economic cost associated with alcoholism and the impact of government’s policy of increasing the age limit. The following is a table showing the statistics for economic cost of alcohol abuse for USA in 1998: economic cost of alcohol abuse   Lost future earnings due to premature deaths 19.80% Other 1.10% Medical consequences 10.20% Traffic crashes (property & administrative costs) 8.50% Alcohol use disorders 4% Other impacts   Lost productivity due to alcohol-related illness 47.50% Crime (legal, property, & administrative costs) 3.40% Lost productivity due to alcohol-related crime 5.50% In order to study deep on the impact presented by each aspect, a pie chart was designed, as shown below for comparison: Figure 2: Pie chart showing various economic cost of alcohol abuse As for health care cost, it represents 14.3% of the resulting total economic cost from alcohol abuse. In which case, the category compiles costs arising from alcohol use disorders, which are treatment and dependence. Treatment cost, associated with alcohol abuses, arise from costs associated with various treatment settings, providers of treatment, pervasive health consequences (Carpenter & Dobkin, 2009, 168). All the aforementioned factors, in one way or another, usually forces the abuser to spend a given amount that may have been avoided. Most of these costs are evident in community based clinics such as pharmaceuticals, hospitals and outpatient clinic. Conclusively, the alcoholic abusers will at once in a lifetime visit these settings for treatment of alcohol use disorder (Zachry et al, 2002, 410). Further, the health care cost category is also supplemented by cost incurred in training for counselors and professionals dealing in prevention and treatment of the disorders. Intuitively, economic cost impact of healthcare system directly affects government spending. This is because much money has to be directed towards carrying research on the possible treatment and prevention (Hoffmann, 2012, 24). Prolific examples of diseases associated to alcohol abuse, such as liver diseases, stroke and trauma, have all triggered many studies. This is a clear representation of the cost impact caused by alcohol on the economic cost of a country. As indicated in the pie chart, another economic cost impact is productivity losses which are represented by 72.7%. The costs arising are associated to premature deaths, alcohol-related illness and alcohol related crimes. However, these aspects present a challenge when measuring the value of their impact on economic goods and services, because they are always unobservable (Booth & Feng, 2002, 158). For this case, the economic theory associated with labor market presents a line of reasoning, which helps in effectively assessing these factors. The theory holds that productivity contribution of workers is a reflective value. This insinuates that in cases of lower productivity, lower earnings are expected and the effect productivity loss can be estimated by looking at the earnings lost (Hafer, & Blume, 2000, 36). The alcohol-premature deaths can be related to this since it insinuates a productive potential loss, and the estimated cost of the loss is determined from amount that may have been earned in the lost lives. Further, disorders arising from alcohol abuse also trigger impairment of productivity, and the loss is estimated in the in the decrease earnings, resulting thereafter (Cook & Moore, 2002, 21). Loss of productivity, as a result of illness, constituted a higher percentage of 67.3% with all these directed to impaired workplace and household productivity of the individuals (Huckle & Parker, 2014, 1088). Further, the individuals are also likely to witness of loss of earnings resulting from time lost when seeking for medication of alcohol abuse disorders. Apart from losses from illness, losses from premature deaths contributed a total percentage of 27.2% (Cnossen, 2007, 699). This can be measured in terms of the mean expected additional years of life and the correspondent average expected value of the individuals earning; in case they had not succumbed to premature deaths related to alcohol abuse. These two productivity losses apply significantly when assessing economic cost of alcohol in the society. Considering the above case, the relevance of government policy of putting restriction on the age meant for alcohol use comes out clearly as a measure strategy for limiting the economic costs mentioned. People below 23 years forms a significant fraction of drug users around the world (Kypri et al, 2014, 1397). Most significantly, the population of adolescence involving in alcohol abuse has been on the rise, which is an implication of their cumulative effect on the economic costs. This implies that imposing the age limit will significantly reduce the economic cost because of its impact on the population of those involved in alcohol abuse. Further, under the age of 23 is the range where most are underemployed. This insinuates that they have a significantly higher chance of involving in alcoholism and their raising their stake on the overall economic cost caused by a alcoholism in a country (Callaghan et al, 2013, 2248). Naturally, alcoholism impact on the associated economic cost will reduce after limiting these individuals from alcohol abuse. All this shows that every government should put as much efforts in imposing limits on age to reduce alcoholism since the aspect has significant impact on the economic state of a country. Bibliography Hafer, F. D., & Blume, E. R. (2000). The growing cost of doing nothing. Electric Perspectives, 25(1), 36-43. Retrieved from http://search.proquest.com/docview/217557698?accountid=45049 Cnossen, S. (2007). 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M., B.Sc, & Cunningham, J. K., PhD. (2013). Effects of the minimum legal drinking age on alcohol-related health service use in hospital settings in ontario: A regression-discontinuity approach. American Journal of Public Health, 103(12), 2284-2291. Retrieved from http://search.proquest.com/docview/1467837344?accountid=45049 Read More