Presented at a conference on Economics and Alcohol in Colchester, UK. Published in edited form as "Paternalism, rationality, and the special status of alcohol", pp. 262-266 in: Marcus Grant, Martin Plant and Alan Williams, eds., Economics and Alcohol: Consumption and Controls. London & Canberra: Croom Helm, & New York: Gardner Press, 1983. (Preparation was supported by a national alcohol research center grant (AA-05595) from NIAAA.)
We might visualize alcohol studies as a great marketplace or rendezvous or flea market, where people from the different tribes of social and health sciences come to show their wares, barter, exchange and profit. Some of the people are regulars at this market, with a permanent stall; others are day-trippers, who set up their stall for a day and then go on their ways.
This conference has been the occasion for a whole new tribe to come to the rendezvous or market. Now it is not that this tribe was utterly unknown in the marketplace before. Certainly Esa Österberg and Brendan Walsh are well known to habitués of this particular marketplace, and we have seen the wares of such other members of this tribe as Robert Leu, Philip Cook and Tony McGuinness before. But usually in the past we have dealt with such tribal members one at a time, and in such a situation that many of the tribal customs will remain hidden. For me, as a kind of folk anthropologist sitting at another stall in the market, one major fascination of this conference is to observe how the members of this exotic tribe of economists interact with each other -- you might say, to watch their tribal dances and how they settle their quarrels. It has been a fascinating and rewarding experience for those of us from other tribes to attend this rendezvous, and I sincerely hope the new tribe will be back at future rendezvous in equal strength.
Actually, as Esa Österberg's paper reminds us, there was a time two or three generations back when this tribe was one of the dominant groups in alcohol studies. Cost accounting schemes can be found in the American temperance literature as early as 1845 (1), and economic studies played an important role in debates over temperance issues in North America (2), just as Esa Österberg reminds us they did in Nordic countries. When the blue-ribbon U.S. Committee of 50 to Investigate the Liquor Problem published its reports at the turn of the 20th Century, they were organised under three headings: Physiological Aspects of the Liquor Problem, Legislative Aspects . . . , and Economic Aspects. . . . Sociological and epidemiological works primarily crept into the discussion under this last rubric of "Economic Aspects". (3)
Whatever its failings, the temperance movement was certainly concerned with the large issues of concern to economists -- with the organisation and pursuit of a just society -- and it is certainly no accident that those of us in the alcohol studies rendezvous turn to economists again as such "macro" level issues of policy and social justice arise again in a very different era and framework. For many of the current issues in alcohol studies, we very much need the contribution of economists. Conversely, in terms of what they may gain from involvement in this particular trading-post, let me simply relate the common experience of another tribe, the sociologists. At a recent conference, Troy Duster put it this way: alcohol is to society as dye or stain is to microscopy (4): that is, alcohol is so ubiquitous in industrial societies and relevant to so many public and private issues and contexts that it is a wonderful tool for outlining, bringing out the contrasts in, illuminating the structure and functioning of our societies.
From the start, the conference has been enlivened by debates about the assumptions the different disciplines bring to the arena, and the economists here have been especially helpful in explaining and illuminating the field's assumptions. Others have discussed and explicated how these assumptions conflict with assumptions of other perspectives, particularly a public health perspective, and we may want to return to some of these issues in our future discussions. While I may share many of the assumptions economists as a field make, as they have been explicated by Leu and others, to my mind this simply reflects that in many ways I share with economists as a trade a historical, cultural and class position, and that the radically individualistic, utilitarian and consumption-oriented presumptions we have heard laid out will be shared mostly by a subset of the minority of the world's population who can be regarded as children of the eighteenth-century Enlightenment. There may indeed be a good deal of paternalism in public health thought, but it might be seen as equally paternalistic for us to impose these Enlightenment presumptions in our calculations on behalf of those in our own and other cultures who are more communitarian than we are, or who do not wish to conduct their lives totally in the role of informed consumer.
I want to concentrate here on some particular assumptions which have threaded through the discussions and which seem to me to interact particularly with the special nature of alcohol issues. One is the issue of rationality. On this issue economists seem to me both to give away too much and not to give away enough. A number of times in the papers and discussions here, economists have made an exception for the alcohol addict or alcoholic concerning the assumption of rationality. In this exception, economists pay deference to the fundamental idea, invented by the temperance movement and carried forward by the modern alcoholism movement (5), that at least some of the heavier drinkers have lost control of their drinking behavior -- and, in the temperance and alcoholism movement formulations, of the rest of their life as well -- as a result of their drinking. It is an idea which has been fitted into the conventional nosologies of psychiatric thought -- the current preferred label is "the alcohol dependence syndrome" (6) -- although I doubt that economists would be willing to cede irrationality to many of the cognate conditions of dependence or mania in psychiatric nosologies. On the other hand, alcoholism is not an idea or condition that the British and American law courts have generally accepted as an exception to their general assumption of rationality on the part of citizens and criminals (7).
The economist's assumption of rationality presumes that consumers will behave so as to maximize their overall pleasure in terms of their own personal calculus. Looking at it in these terms, the dependent heavy drinker seems empirically to behave in accordance with rationality. He or she places a high value on drinking, but it is not infinite. In experimental situations involving "happy hours," the habitual heavy drinker proves responsive to price (8); Nordic data suggests that even Skid Row alcoholics respond in their drinking behavior to price and availability fluctuations (9). Phil Cook's and other evidence of the linkage of price and cirrhosis mortality provides aggregate-level evidence that economic considerations affect long-term heavy drinkers who are close to dying from cirrhosis (10). From this point of view, the alcohol addict does not look very different from the ski buff or motorcycle racer who have been offered up in our discussions as examples of consumers whose personal calculi discount risks more than we might.
But while I would argue that perhaps the alcohol addict does not need to be treated differently from the rest of us with regard to the assumption of rationality, I would argue that the economic assumptions surrounding rationality are in serious difficulty respecting all of us. Marcus Grant and Larry Wallack could tell you that the "knowledge-attitude-behavior" model which so long dominated health education has been under sustained attack in that field (11). The paradigm that information leads to preference change leads to consumer behavior was just as fundamental and congenial to that field as it is to economics; but health educators had to test their assumptions in their daily work, and they turned out not to match empirical reality. The field has been in a creative ferment for some time since the debacle had to be recognised.
It seems to me that, with respect to alcohol as to many other consumer goods, we need a set of assumptions instead that reflect that the individual preferences and behaviors we observe at any moment are not simply the result of a constantly updated Benthamite calculus carried out by the individual in isolation; the preferences and behaviors reflect among other things the existing structuring of the market and more generally a wide range of cultural and historical influences. In a modern society, most commodities are subject to habit formation in a technical sense (12), and the external structuring and habit formation involved are legitimate objects of collective concern. To cry that this is "paternalism" is to ignore the non-Benthamite functioning of preferences and purchases and to lend de-facto support to existing conditions in the system's structuring of consumer behavior.
With respect to alcohol in particular, we need to examine and draw on our collective historical experiences in considering the appropriate way of handling alcohol both conceptually and societally. Historically, at least in the many European and anglophone countries and colonies affected by the temperance movement, alcohol has been handled as a special commodity -- what the economists involved in the International Study of Alcohol Control Experiences (ISACE) (13) called a "demerit good", or Mark Moore and Philip Cook in the context of the National Academy of Sciences panel (14) referred to as a "hazardous commodity". What we found in the seven case studies of ISACE was that uniformly in the postwar era, there was a movement towards normalisation of alcohol in the marketplace (15). Many of the societal signals of alcohol's standing as a demerit good and provisions reflecting this were eroded away; with the decline of other organised interests, traditionally focussed through temperance organisations, the interests of those who produced and distributed alcohol became more and more dominant.
In this era, alcohol consumption rose nearly everywhere. What we found also was that not only the sequelae of long-term heavy drinking such as cirrhosis but also social and casualty problems empirically tended to rise as consumption rose. The attempts to substitute new less disruptive drinking patterns for old ones, notably in Finland, resulted mostly in the addition of new behaviors to the old ones (16).
Perhaps in a lagged reaction to this, societies like those studied in ISACE seem to have experienced a point of inflection sometime in the 1970s (17). Partly of course reflecting economic difficulties, consumption stabilized or fell, at least temporarily. In a number of countries and a number of ways, small symbolic steps have been taken toward redifferentiating alcohol from the general market, reemphasising a special status for it as a demerit commodity. In a literal expression of this, Switzerland and Ireland have provided that there should be a barrier between alcohol and other goods in supermarkets (18). Nordic countries have experimented with various restrictions of availability, and an initiative petition is currently circulating in Sweden to restore a version of the "motbok" rationing system. A majority of the U.S. states that lowered the legal drinking age in the early 1970s have at least partially raised it again (19). A nationwide poll the other day showed a majority in favor of raising federal alcohol and tobacco taxes, in part to help prevent alcohol problems and in part to help federal finances (20). The fact of this conference must be seen as an indirect result of analogous shifts in the climate of opinion in the United Kingdom.
This history seems to me relevant to economists in two ways. One is that they should recognize its import in their assumptions and calculations. It is as paternalistic in one direction for economists to ignore clear societal statements about alcohol's status as a commodity and the policy basis for restrictions on the free market in alcohol as it is in the other direction for consumer preferences to be ignored. Whatever we may think personally about the wisdom of the provision, a society which does not allow children into pubs with their parents is not a society which is treating alcohol like any other commodity.
The second relevance is that economists are very much needed in the enterprise of studying and understanding what is going on in this history and its manifestations in the present day. The economists involved in ISACE made valuable contributions, but ISACE only scratched the surface of issues in one period to which the tools and paradigm of economics are relevant.
In this regard it would be my hope that economists would expand their horizons to study big changes as well as the marginal effects which Tony McGuinness and others remarked were their stock in trade. Big changes in both directions with respect to the entrenchment of psychoactive drug use in a population are commonplace in history. In my view concepts like "latent demand" or the frustration of demand are totally inadequate to characterise or understand the very substantial drop in alcohol consumption in the US in the 1830s, the current explosion of consumption in Papua New Guinea, or the tripling of alcohol consumption in France in the mid-nineteenth century (21). Economic factors are certainly important in all these instances, and supply manipulation factors play a paramount role in some other big changes -- e.g. the decline in British consumption at the time of the First World War (22), and the decimation of Danish spirits consumption in 1917 (23). But in many of these historical instances, as in the current events in Poland (24), major autonomous shifts in sentiments in the population must be taken into account. If there is any ambition to do more than manage the surface ripples on the sea of alcohol-related problems, economists and others of us must get ambitious and study big changes and how they happen.
1. Samuel Chipman, The Temperance Lecturer: Being the Facts Gathered from a Personal Examination of All the Jails and Poor-Houses of the State of New York ... Showing the Effects of Intoxicating Drinks in Producing Taxes, Pauperism and Crime. Albany, NY: 1845. See: Harry Gene Levine, "The Good Creature of God and the Demon Rum: Colonial and 19th Century Ideas about Alcohol, Crime and Accidents", pp. 111-161 in: Robin Room and Gary Collins, eds., Alcohol and Disinhibition. NIAAA Research Monograph 12. Washington, DC: USGPO, 1983.
2. See, for example: Herman Feldman, Prohibition: Its Economic and Industrial Aspects, New York: D. Appleton & Co., 1927; Irving Fisher, Prohibition at Its Worst, New York: MacMillan, 1926; Irving Fisher, The "Noble Experiment", New York: Alcohol Information Committee; Clark Warburton, The Economic Results of Prohibition, New York: Columbia University Press, 1932.
3. Frederic Wines and John Koren, The Liquor Problem in Its Legislative Aspects, Boston: Houghton Mifflin, 1897; John Koren, Economic Aspects of the Liquor Problem, Boston: Houghton Mifflin, 1899; John S. Billings, ed., The Physiological Aspects of the Liquor Problem. 2 vols., Boston: Houghton Mifflin, 1903. There was also a volume on Substitutes for the Saloon, and a summary volume (The Liquor Problem). See: Harry Gene Levine, "The Committee of Fifty and the Origins of Alcohol Control", Journal of Drug Issues13:95-116, 1983.
4. Troy Duster, Commentary on "Drinking, Disinhibition and American Subcultures", pp. 326-330 in: Robin Room and Gary Collins, eds., Alcohol and Disinhibition: Nature and Meaning of the Link.. NIAAA ResearchMonograph 12. Washington, DC: USGPO, 1983.
5. Harry Gene Levine, "The Discovery of Addiction: Changing Conceptions of Habitual Drunkenness in American History", Journal of Studies on Alcohol39:1, pp. 143-174, 1978.
6. Problems Related to Alcohol Consumption: Report of a WHO Expert Committee. Geneva: World Health Organization, Technical Report Series 650, 1980.
7. James Mosher, "Alcohol: Both Blame and Excuse for Criminal Behavior", pp. 437-460 in: Robin Room and Gary Collins., eds., Alcohol and Disinhibition: Nature and Meaning of the Link. NIAAA Research Monograph 12. Washington, DC: USGPO, 1983.
8. T.F. Babor, J.H. Mendelson, I. Greenberg and J. Kuehnle, "Experimental Analysis of the 'Happy Hour': Effects of Purchase Price on Alcohol Consumption", Psychopharmacology 58:35-41, 1978; T.F. Babor, J.H. Mendelson, B. Uhly and E. Souza, "Drinking Patterns in Experimental and Barroom Settings", Journal of Studies on Alcohol 41:635-651, 1980.
9. Salme Ahlström-Laakso, Drinking Habits among Alcoholics. Helsinki: Finnish Foundation for Alcohol Studies, vol. 21, 1975; Klaus Mäkelä", "Differential Effects of Restricting the Supply of Alcohol: Studies of a Strike in Finnish Liquor Stores", Journal of Drug Issues 10:131-144, 1980; Øyvind Horverak, "The 1978 Strike at the Norwegian Wine and Spirits Monopoly: Effects on the Supply and Consumption of Alcohol and on Some Alcohol-Related Problems". Presented at the Epidemiology Section meeting, 27th International Institute on the Prevention and Treatment of Alcoholism, Vienna, June 1981.
10. John R. Seeley, "Death by Liver Cirrhosis and the Price of Beverage Alcohol", Canadian Medical Association Journal 83, pp. 1361-1366, 1960; Kettil Bruun, Griffith Edwards, Martti Lumio, Klaus Mäkelä, Lynn Pan, Robert Popham, Robin Room, Wolfgang Schmidt, Ole-Jørgen Skog, Pekka Sulkunen, and Esa Österberg, Alcohol Control Policies in Public Health Perspective. Helsinki: Finnish Foundation for Alcohol Studies, vol. 25, 1975.
11. See: Lawrence M. Wallack, "Mass Media Campaigns: The Odds against Finding Behavior Change", Health Education Quarterly 8:209-260, 1981.
12. See: H.S. Houthakker and L.D. Taylor, Consumer Demand in the United States: Analyses and Projections, second edition. Cambridge, MA: Harvard University Press, 1970; and Robin Room, "Evaluating the Effect of Drinking Laws on Drinking", pp. 267-289 in: John Ewing and Beatrice Rouse, eds., Drinking: Alcohol in American Society -- Issues and Current Research. Chicago: Nelson-Hall, 1978.
13. Klaus Mäkelä, Robin Room, Eric Single, Pekka Sulkunen and Brendan Walsh, with 13 others, Alcohol, Society and the State: I. A Comparative Study of Alcohol Control. Toronto: Addiction Research Foundation, 1981.
14. Mark Moore and Dean Gerstein, eds., Alcohol and Public Policy: Beyond the Shadow of Prohibition. Washington, DC: National Academy Press, 1981.
15. See, besides Mäkelä et al., cit. supra: Eric Single, Patricia Morgan and Jan de Lint, eds., Alcohol, Society and the State: II. The Social History of Control Policy in Seven Countries. Toronto: Addiction Research Foundation, 1981. See also: Gunno Armyr, Ake Elmer and Ulrich Herz, Alcohol in the World of the 80s: Habits, Attitudes, Preventive Policies and Voluntary Efforts. Stockholm: Sober Förlags, 1982.
16. Dan E. Beauchamp, "Alcohol Policy in an International Perspective", pp. 127-151 in: Beyond Alcoholism: Alcohol and Public Health Policy, Philadelphia: Temple University Press, 1980; Pekka Sulkunen, Alkoholin Kulutus: Ja Elinolojen Muutos Toisen Maailmansodan Jalkeen (Alcohol Consumption and the Transformation of Living Conditions after the Second World War; text mainly in English). Vammala: Vammalan Kirjapaino, 1980.
17. Mäkelä et al., cit. supra.
18. Monique Cahannes, "Swiss Alcohol Politics: The Emergence of a Compromise", Contemporary Drug Problems 11:37-54, 1981; James Mosher, "International Trends in Alcohol Consumption, Alcohol-Related Problems and Alcohol Control Policies", pp. 201-218 in: Gunno Armyr et al., cit. supra.
19. Alexander Wagenaar, "Legal Minimum Drinking Age Changes in the United States: 1970-1981", Alcohol Health and Research World 6(2):21-26, 1981/82.
20. NBC News and The Associated Press, "October National Poll" (#71, 10 November 1981); AP story carried in The Berkeley Gazette, November 3, 1981, p. 16.
21. Susanna Barrows, "After the Commune: Alcoholism, Temperance and Literature in the Early Third Republic", pp. 205-218 in: John M. Merriman, ed., Consciousness and Class Experience in Nineteenth-Century Europe. New York: Holmes and Meier, 1979. 22. H. Carter, The Control of the Drink Trade in Britain, London: Longmans Green & Co., 1919; A. Shadwell, Drink in 1914-1922: A Lesson in Control, London: Longmans, Green & Co., 1923.
23. Rupert Wilkinson, The Prevention of Drinking Problems: Alcohol Control and Cultural Influences. New York: Oxford University Press, 1970; pp. 37-39.
24. Jacek Moskalewicz, "Alcohol as a Public Issue: Recent Developments in Alcohol Control in Poland", Contemporary Drug Problems 11:11-22, 1981; Antoni Bielewicz and Jacek Moskalewicz, "Temporary Prohibition: The Gdask Experience", Contemporary Drug Problems 12:367-382, 1982.