October 14, 2010

A Pack of Cigarettes Cost $138

(Ivanhoe Newsflash) -- "A pack of smokes, please."  The lady behind the counter smiles and reaches back to grab the cigarettes as you reach into your wallet for money.  As she slides the barcode on the pack past the scanner, you nearly fall over when the price comes up.  "I know they overtax cigarettes, but there's no way its $138 for a pack," you say aloud.  The cashier enlightens you by saying "Researchers estimate that each pack of cigarettes essentially costs $148 for men and $104 for women, when premature death is taken into account."  She smiles and pushes the pack towards you.  "You still want these?" 

"One of the conclusions of the article is that the price one pays for each pack of cigarettes at a newsstand is only a very small price of the true price that smokers pay for their habit," which Ángel L³pez Nicolás, co-author of the study and researcher at Polytechnic University of Cartagena (UPCT), was quoted as saying.  "Given that tobacco consumption raises the risk of death in comparison with non-smokers, it can be assigned a premature death cost for people who do smoke."

According to the study, the average cost for a pack of cigarettes is not in fact $4 or $5, but closer to $138.  The standard cost for male smokers is $148 per pack where as women happen to pay closer to $104.

The study questions the adage of archetypal economics on "consumer sovereignty."  Those who smoke do not do so because the enjoyment of smoking is superior to the cost, but rather due to the addictive power of nicotine and their absence to understand the factual cost.

Researchers set out to determine the mortality cost associated with tobacco consumption in Spain.  The Vale of a Statistical Life (VSL) -- the amount that people are prepared to pay in order to reduce their risk of death -- estimated that the average price to be around $4.13 million.  "For smokers, this is around $5.23 million," L³pez Nicolás explains. "But one must not confuse the cost of premature death with the cost of healthcare," L³pez Nicolás points out.  "The cost of premature death is borne by the smokers themselves."

Understand the cost of smoking makes prevention a little easier.
"The estimated cost of premature death from a pack of cigarettes is a key element in the cost-benefit analysis of policies designed to prevent and control smoking", according to researchers.

In due course, the study indicates that the taxes and smoking restrictions forced in public places reinforce smokers' self-control mechanisms.
Researchers from the study add that, "smoking prevention and control policies could generate considerable social benefits, since the wellbeing losses associated with tobacco consumption are much greater than suggested by the external costs." "Despite the law on healthcare measures to combat smoking having come into effect in 2006, more can still be done in Spain on measures to control tobacco consumption," experts conclude.

SOURCE: Revista Española de Salud Pública, October 2010