Claude Jeanrenaud

Social Cost of Smoking in Switzerland

Smoking is a major concern in public health policy as it produces numerous adverse effects on health. Some of them, such as lung cancer or chronic bronchitis, are mainly attributable to tobacco use, whereas others are related partly to smoking — e.g. mouth cancer or atherosclerosis. The impact of these disorders is usually assessed by means of non-monetary indicators, for example the number of deaths or disabilities related to smoking, the frequency of work incapacity, or the number of potential life years lost as a consequence of smoking. There were 8,300 deaths — or one in six — and more than 16,000 individuals who became disabled due to smoking in 1995 in Switzerland. We estimated that approximately 50,000 years of potential life and more than 5 billion working days were lost. This data reveals the magnitude of the adverse outcomes of smoking, but does not provide a global picture of the burden placed on society. The aim of the present study was to estimate the economic and non-economic consequences of smoking1. By using monetary values one can summarise the numerous adverse effects expressed in a single figure: the social cost of tobacco consumption. In Switzerland, a study conducted by Leu and Schaub (1985) valued the economic costs of smoking for 1976.

Economic Instruments for Environmental Policy

From the mid-70s up until the beginning of the present decade, environmental policy benefited from a particularly favourable climate. New programmes enjoyed practically unlimited popular support, and moved easily through the different stages up to implementation. Even the tightening of standards at close intervals did not lead to protests from the economic circles consulted — at least not openly. Politicians found it difficult to resist the adoption of more stringent measures, even when they might have had some doubts as to the usefulness of the programmes. The cost of the regulations for the economy was not a subject of discussion; moreover, there was no information available in that connection. The only concern was reaching environmental targets, whatever the cost. All these measures led to a significant improvement in environmental quality, but their limits have become clear today.

Environmental policy between regulation and market

1. Introduction.- Economic Instruments for Environmental Policy.- 2. Environmental Charges.- 2.1 Environmental Taxes: Analytical Framework.- 2.2 Environmental Taxes in the Italian White Paper on Fiscal Reform.- 2.3 Cars and Environment in Switzerland: What Kind of Taxes?.- 3. Greening of the Tax System.- 3.1 Principles of an Ecological Fiscal Reform.- 3.2 Testing the Double Dividend Hypothesis for a Carbon Tax in a Small Open Economy.- 4. Tradeable Permits.- 4.1 Designing Efficient Treaties to Protect the Global Environment.- 4.2 Designing a Trading Programme for Emissions of Nitrogen Oxides in the Northeastern United States.- 4.3 Emission Trading: The Basle Experience.- 4.4 A Tradeable Permit Market for NOX: An Application to the Chablais Region.- 4.5 Tradeable Permits in Switzerland: The Legal Perspective.- 5. Covenants.- 5.1 Covenants from Instrument of Environmental Policy to Implementation Tool.- 5.2 Covenants as Central Elements in an Effective Environmental Policy Mix.- 6. Acceptability of Economic Instruments.- 6.1 Economic Instruments and Social Acceptability: A Debate about Values.- 7. Direct Regulation and Economic Incentives: Opposition or Complementarity?.- 7.1 Direct Regulation and Economic Instruments: Antagonists or Allies?.- 7.2 Regulations and Market-based Instruments in Swiss Environmental Policy.- 8. Conclusion.- What Have We Learned About Market-based Instruments?.

Do Benefit and Equal Absolute Sacrifice Rules Really Lead To Different Taxation Levels

The benefit and ability to pay principles of public finance are generally presented as two different concepts of fiscal equity. Redistributive taxes are generally based on the ability to pay principle. The authors show that in the case of pure public goods, under specific conditions, the benefit and the equal absolute sacrifice rules lead to very similar taxation levels. Therefore the choice of taxation rules is of secondary importance. By contrast, the value of the elasticity of marginal income utility plays a primary role.