"This is a problem that cuts across gender, age and socio-economic group and is growing in every part of Scotland.
"It's clear that the high alcohol consumption we're now seeing across society has very serious consequences for our health as a nation. We have to look at the evidence of what works in order to get to grips with it."
He said setting a minimum price was a "no-brainer" solution for controlling alcohol consumption.
Dr Peter Anderson, a consultant to the World Health Organisation, who also advises the European Commission, told delegates: "Outside of governments which own retail stores for the sale of alcohol, no jurisdiction has set a minimum price of alcohol. Internationally, Scotland is seen as a public health leader.
"You had the courage to introduce smoke free pubs; let us hope that you have the same courage to introduce a minimum price for alcohol."
But Jeremy Beadles, chief executive of the Wine and Spirits Trade Association, said minimum pricing was not a panacea for solving "deep-seated cultural problems".
He said: "Those who claim minimum pricing is the solution to Scotland's problem with drink should consider why alcohol misuse remains an issue in Ireland and Scandinavian countries where alcohol is highly taxed and very expensive."
'National consensus'
Health Secretary Nicola Sturgeon said: "This government believes the time has come for radical action to cut the £2.25bn cost of alcohol misuse to Scotland. But we're under no illusions that we have to take people with us and that includes the whole political spectrum, the alcohol industry and retailers.
"This issue is bigger than politics and we owe it to the people of Scotland to tackle the scourge of alcohol misuse.
"Today's summit was an opportunity to sit down with others who share our determination, so that we can work towards a consensus."
Labour's Cathy Jamieson said her party wanted to see measures which get to the heart of Scotland's drinking.
She said: "We need a national consensus to tackle Scotland's hard drinking culture and I am pleased that the Scottish Government agreed to Labour's request for an all-party summit on alcohol abuse.
"Labour has put forward proposals for a ban on billboards advertising alcohol near schools and a mandatory code of practice for retailers, but we will look seriously at any credible proposals that will reduce the level of problem drinking in Scotland."
The Liberal Democrats said minimum pricing would not tackle deprivation levels that are at the heart of the challenge of alcohol abuse, while the Conservatives also said no pricing plan would make a significant difference without understanding why people drink to excess.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/uk_news/scotland/8111643.stm
Published: 2009/06/22 16:45:49 GMT
© BBC MMIX
The article is about the government of Scotland planning to put a minimum price on alcohol in the country. It has been brought to the notice of the government that majority of crimes are caused due to alcohol and there has also been many other kinds of misuse. They feel that putting a minimum price on alcohol would help decrease the sales and help strengthen the economy more by decreasing the amount of problems caused by it.
Price control is a strategy used to shift the price, which results in excess supply or demand when there is no market equilibrium. Market equilibrium is when the demand and supply meet and there is no excess demand or excess supply. Maximum price is the price set under the market equilibrium price level, also known as ceiling price; this results in excess of demand. A minimum price is set above the market equilibrium price, so there is excess supply, also known as floor price. Usually, minimum price is set in order to protect the suppliers, but in this case, it is set to protect the consumers. The Scottish government is setting a minimum price on alcohol in order to decrease sales, which will benefit the society and make it a safer place. The amount of crimes, deaths, illnesses, and other misuses taking place in the economy will reduce if they put a minimum price. It may also result in excess of supply. The government will then have to discover a scheme to relieve the economy of the excess stock.
According to the price mechanism, if the price of product rises, the demand will fall. There will be an excess of supply if a minimum price is set due to the less amount of alcohol sold. Dr. Harry Burns claims in this article that minimum price on alcohol would not change anything, that it was a “no brainer” to do so. Price elasticity of demand is the responsiveness of demand due to change in price. Alcohol is assumed to be a necessity for the Scottish, therefore the price elasticity for alcohol is negative; it is inelastic since the change in price would be much greater than the change in quantity demanded. Its price elasticity of demand before the minimum price is imposed cannot be determined from the information offered in the article.
An externality is either a benefit or a burden on the economy due to the production of a particular good or service. Positive externality is when the marginal social benefits outweigh the marginal social costs and the private benefits. Alcohol is a negative externality for the economy. Negative externality results to a market failure because the marginal social cost is more than the marginal social benefit and the private cost. Both result in market failure. Private cost is the cost or input of a private firm. Marginal Social Benefit is the benefit the society receives from alcohol and marginal social cost is the cost that the society pays for alcohol for example crimes that are caused by alcohol. The burden and cost of the consumption negative externality is held by a third party. The cost and burden of consumption of alcohol is held by the society; in this case, the burden and cost is the amount of crime and illness in the society. In a few years, it could affect the whole population more.
As it is stated previously, putting a minimum price on alcohol may limit sales since it may have an inelastic price elasticity of demand. It could be good for the economy if less people consume alcohol since it is a negative externality and it affects the society in many ways. It will also result to an excess of supply of alcohol since consumers’ demand may lower due to the sudden increased price.
