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TE TEMPTATI TION GOODS, HARM REDUCTI TION AN AND DUAL AL MAR - - PowerPoint PPT Presentation
TE TEMPTATI TION GOODS, HARM REDUCTI TION AN AND DUAL AL MAR - - PowerPoint PPT Presentation
TE TEMPTATI TION GOODS, HARM REDUCTI TION AN AND DUAL AL MAR ARKETS Mark A.R. Kleiman Marron Institute New York University Te Temptation goods: no ordinary commodities Tendency to induce excessive consumption compared to the users
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Te Temptation goods: examples
- Alcohol
- Nicotine
- Cannabis
- Opiates
- Stimulants
- Gambling
- Sweet/salty/oily foods
- Videogames
- Pornography
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Te Temptation goods create “internalities”
Axioms of consumer choice fail to hold Paternalistic intervention may be warranted.
- Taxation
- Regulation
- Prohibition
Those interventions always create adverse effects, including the risk of illicit markets
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No good is a temptation good for all consumers
* Typical case: minority of problem users, majority of contented users * Pareto’s Law: 80% of the activity concentrated in 20% of the users * Likely to overlap heavily with problem users *Certain to dominate the economics of the market, licit or illicit
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Th The “harm reduction” controversy
Tension between policies designed to reduce extent of use and policies designed to make use less harmful Harm reduction is three things
- A utilitarian maxim
- A set of techniques
- An ideology
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Ma MacCou Coun’s Eq Equation H H = h x u
H = total harm h = harmfulness or harm rate u = extent of use Reducing h or u reduces H as long as the other factor doesn’t increase more than proportionally.
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Th The nicotine harm reduction controversy
Should less-harmful forms of nicotine be encouraged to reduce harmfulness
- r discouraged to prevent an increase in use?