Cost benefit analyses of alcohol policy - a primer

Alcohol is no ordinary commodity (Babor et al 2010). In health terms, it is a toxic substance. In legalterms, it is a licit drug whose sale and consumption are highly regulated. In economic terms, its useresults in major external costs (consumption externalities), and its use leads to both short-termirrationality (i.e., intoxication) and long-term irrationality, and to information failures (MarsdenJacob Associates 2009).Alcohol is a cause of considerable health and social burden to the European Union. Alcohol is a causeof over some 60 conditions and disorders (Rehm et al 2010), and is the third leading risk factor for ill-health and premature death in the European Union after hypertension and tobacco use (Anderson &Baumberg 2006). The harm done by alcohol is exacerbated by health inequalities (Anderson &Baumberg 2006), and alcohol is a major cause itself of health inequalities within and betweencountries. It has been calculated that some 25% of the differences in middle aged life expectancybetween eastern and western Europe is due to alcohol (Zatonksi et al 2008). It is estimated that theoverall social cost of alcohol to the Union is some €125billion each year (Anderson& Baumberg2006).There is a very extensive evidence base for the impact of policies in reducing the harm done byalcohol (WHO 2009a; Anderson et al 2009; Babor et al 2010). Systematic reviews and meta-analysesshow that policies that regulate the environment in which alcohol is marketed (particularly its priceand availability) are effective in reducing alcohol-related harm. Enforced legislative measures toreduce drinking and driving and individually-directed interventions to already at-risk drinkers arealso effective. On the contrary, school-based education is found not to reduce alcohol-related harm,although public information and education type programmes have a role in providing information,and in increasing attention and acceptance of alcohol on the political and public agendas.