The Hindu Business Line : Did you know that each smoker costs Rs 96,80,000 over his lifetime?

MARK Twain said, "To cease smoking is the easiest thing I ever did. I ought to know because I've done it a thousand times." As if to make it easier for those who care to stop smoking, there is the new policy from the Government. The Ministry of Health has not only sent the right smoke signals by setting a timer as August 1, but also lit the fuse on the most powerful medium that tobacco products have enjoyed all along, viz. the screen, be it silver or small. To explore the economic dimension of what is often unsympathetically called the phenomenon of fire at one end and fool at the other, I pick up to read The Price of Smoking, by Frank A. Sloan et al from The MIT Press (http://mitpress.mit.edu).

"This book provides a detailed analysis of the price of smoking, both in terms of the burden imposed on the smoker and his or her family and the burden imposed on other members of society," states the preface, approaching an activity that is `the leading cause of preventable death' in the world.

Alarming numbers hit you in the face from the dust jacket: "Cost of smoking to a 24-year-old woman smoker is $86,000 over a lifetime; for a 24-year-old male smoker the cost is $183,000. The total social cost of smoking over a lifetime — including both private costs to the smoker and costs imposed on others comes to $106,000 for a woman and $220,000 for a man. The cost per pack over a lifetime of smoking: almost $40."

Converting the dollar values to rupees may give those addicted a heartache. The study focuses not on a single period such as a year, but goes over the life cycle of the smoker to gauge "the present value of the cost of adding a smoker to society", because there are always a few newcomers to the smoky den. The authors point out that most previous studies have addressed only one of the components of costs, or on a limited perspective.

Who bears the cost of smoking? Over 90 per cent of the total costs of smoking were found to be incurred on behalf of smokers themselves, according to studies conducted before 2002, recount the authors. "Two-thirds of this was in the form of actual expenditures, principally on medical care and cigarettes." The balance one-third related to productivity (morbidity and mortality) losses. "Mortality losses were nearly twice morbidity losses. Costs imposed on infants and children were about four times as large as those imposed on spouses." Thus, spouses are less susceptible to be 'innocent victims'. "Given the relatively early age at which most smokers begin their habits, relatively few spouses enter into their marital relationships unaware of their partners' smoking habits."

Love may be only blind, but perhaps it is good at in olfaction. Though the last thing that the partners would remember is the warning of King James I that "Smoking is hateful to the nose, harmful to the brain, and dangerous to the lungs."

Exploring the effects of smoking on mortality, the authors observe, "The full mortality effects of smoking can generally be observed 30 to 40 years after the onset of habitual smoking." Life tables in the book show that current and former smokers were much more likely to be heavy or problem drinkers than were never smokers, were less risk averse, and "were likely to have a shorter financial planning horizon than never smokers." Probably, tomorrow was too distant in their reckoning.

A different chapter looks at what should be important for policy makers — increase in healthcare outlay due to smoking. "To the extent that smoking increases outlays incurred by private insurance plans, there is some additional tax revenue that does not accrue to the public treasury," argue the authors. "This amount is approximately the product of the average marginal tax rate multiplied by the extra expense incurred by private health insurance plans that is attributable to smoking." One may study if insurance plans available in India factor in the smoking habit.

On insurance, again, the authors as the question, "Do non-smokers cross-subsidise smokers?" The answer is in the affirmative. The subsidy was $2,019 per female and $12,013 per male. "This subsidy would not have occurred if insurers had universally charged smokers the actuarial value of the loss in death-contingent payments that smoking causes." Is there a case for IRDA to insist on a surcharge? Firm that surcharge may be able to attract non-smoking policyholders from other firms.

The chapter on morbidity, disability, and work loss, cites the WHO's finding: That numerous cancers have been linked to smoking or exposure to tobacco smoke, including lung cancer, head and neck cancers (including cancers of the oesophagus, larynx, tongue, salivary glands, lip, mouth and pharynx), urinary bladder and kidney cancers, uterine, cervix, breast, pancreas, and colon cancers. Smokers are 5 to 10 times more likely to develop lung cancer, 12 times as regards laryngeal cancer, and 27 times for oral cancer. Also, current smokers were more likely to need help with chores, shopping, and so on, a.k.a. IADLs or `instrumental activities of daily living limitations'. A depressing finding that the book includes is that at all ages, being a smoker increased "the probability of self-reporting that one is in fair or poor health." Don't discount the self-report, advise the authors, because "people who state that they are in fair or poor health are more likely to experience adverse healthy events in the future."

There are external costs in the form of health effects of smoking on others. "Family members, especially spouses, routinely engage in trades," such as when the husband smokes and the wife goes on a shopping spree. "Myriads of trades are made over the course of a marriage. If marriage partners have better outside options net of the cost of dissolving the marriage, the marriage dissolves." Such break-ups are a different type of cancer.

Do you know that ETS or environmental tobacco smoke is a mixture of sidestream and mainstream smoke? The latter is smoke inhaled and exhaled by the smoker, while the former is "the smoke emitted from a smouldering cigarette between puffs." The ratio, on an average, is "85 per cent sidestream and 15 per cent mainstream." Sidestream smoke contains most of the same toxic and carcinogenic compounds as mainstream smoke, some in even higher concentration.

"An average woman married to a male smoker by age 24 has a reduced life expectancy of 0.39 years if she too smokes or 0.20 years if she does not smoke." Fortunately, workplace smoking has reduced because employers are increasingly imposing restrictions. "Even smoking in the home has decreased dramatically," observe the authors, and add that smokers have increasingly become conscious of the need to avoid other household members being exposed.

The final word from the book is that tobacco control programmes can help curb the high costs of smoking and also increase cigarette taxes. However, the authors are sceptical whether these measures alone would be enough. More important is for persons aged 24 and younger to understand that "the decision to smoke is a very costly one". For, estimating such cost is only a first step in fighting the hazard.

Useful work that deploys costing and accounting in public interest.

Economics@TheHindu.co.in

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Did you know that each smoker costs Rs 96,80,000 over his lifetime?