Question

What do we mean when we say that “people may lack self control”? Is this argument consistent with the assumption of rational choice? Governments around the world have adopted public policies to control tobacco consumption, including information provision, restricting smoking in public places, and imposing exercise taxes on tobacco products. If people lack self-control, what is the most effective policy for tobacco control?

Answer 1

For addictive subsatnces like tobacco, consumers view it as a good commodity producing a high level of utility while non-consumers and the government (which has a welfare objective) view tobacco as a bad commodity emmitting negative externalities in the form of passive smoking, increased health expenditure, lower life expectancy etc. The social cost is higher than the private benefit. Consumers are made aware of the ill-consequences with nmeasures like higher taxes, provision of information, restricting public smoking etc. A consumer (if positively influenced) by such measures may take the decision to quit while acting on the same is entireloy different since s(he) will have to reorder their preferences for such products- this is where the lack of self-control comes to the picture- they might make the "rational choice" of quitting but the lack of self-control/discipline will act as a barrier to act on the rational choice.

There are still other people who will never quit the habit of smoking even after absorbing all the information about its ill-effects- for such people, the 'rational choice" remains the same before and after the policy measures. There cannot be one effective policy for tobacco control for two reasons-

1. It is a significant source of revenue for governments.

2. The tobacco and allied industries has a siginificant lobbying power by which they can convince authorities that they will conform to objectives of public health concerns.

It will remain a mix of measures mentioned in the question trying to influence consumers at the margin to make a "rational choice" considering their health as well as the health of others and the environment. The only other way would be to ban the production and consumption of tobacco altogether which has consequences on jobs in the industry as well the fact that the government will not like to lose a good source of revenue. Along with this, there is an ethical debate of whether one should ban something or give consumers the right to choose,