An Economists Approach to Alcohol Abuse - 1324 Words

Suggest how an economist would approach the problem of alcohol abuse. Provide two (2) possible solutions to this problem. Include the four (4) elements of the economic way of thinking in your analysis. It is a genuine case of negative externalities both in production and consumption. Alcohol production also causes pollution of the environment especially due to the large CO2 emissions produced by factories and some of the byproducts. Two possible solutions to these problems proposed by economists are: Coase theorem. Negotiating for compensation with no any government intervention on condition that the cost of negotiation is not high and the property rights are secured. Pigouvian regulations or taxes: Drunk driving is incorporated. An economist would raise cost through reduced availability and added taxes Analyze how prescription drugs affect the demand and supply of other products and services in this country. According to Garrod and Willis (2007), in economics, the law of supply and demand is regard as one of the fundamental principles running an economy. It is illustrated as the situation where as supply raises the price will likely drop or vice versa. As demand raises the price will likely increase or vice versa. Essentially this is a standard that nearly all people intuitively understand concerning the relationship of services and goods against the demand for those services and goods. According to Lipsey and Courant (2011), when demand and supply areShow MoreRelatedThe Walt Disney Company and Disney Management25371 Words   |  102 Pagesencountered difï ¬ culties with regard to competition—the World’s Fair in Seville and the 1992 Olympics in Barcelona were huge attractions for European tourists. Disney management’s conviction that it knew best was demonstrated by its much-trumpeted ban on alcohol in the park. This rule proved insensitive to the local culture, b ecause the French are the world’s biggest consumers of wine. To them a meal without un verre de rouge is unthinkable. Disney relented. It also had to relax its rules on personal grooming