Of Smoke and Ice

Tyler Cowen links to an article about Iceland’s plans to ban the sale of cigarettes. This sounds like really bad public policy. Don’t get me wrong, the negative effect on other people from inhaling cigarette smoke is a very good example of a failure of the Coase theorem: the high transaction costs of bargaining with every smoker you meet to pay him not do so while you are around, prevent an efficient outcome from being realized. However, the right way to respond to a negative externality is by taxation or regulation, not by making something illegal.

On the one hand, think about long hair. How would you feel about the government deciding that looking at long hair is unbearable for those whom the wearer meets every day and the thicket on our heads might also lead to infections. Would it be justified to outlaw long hair? Of course not. While public spaces might be legitimately protected from shaggy youngsters, banning hair salons from supporting such hairdos would obviously be unjustified. Similarly, every smoker has the right to keep smoking while only endangering their own health. After all, who are we to judge whether or not this is a tradeoff they are willing to make? As long as no one else is harmed and they have all the relevant information available,  let the smokers smoke, just like we should let the lovers love and the females work – the dark history of discouraging “indecent” behaviors to the detriment of the individuals involved should give us pause.

On the other hand, the negative fallout from this policy might dwarf any potential benefit. Historical examples like the Prohibition or the ongoing war on drugs have shown that enforcement of sales bans can be very costly and creates black markets that fund other sorts of crime. At the same time, compensatory addictive behaviors might proliferate in smoking’s stead, because the wicked will find always find a way to wallow.

While policymakers might like to envision a world of puritan fitness fanatics who follow parliamentary debates, go to art museums and take bike rides (with a helmet!) when they want to relax, in reality most people like to take a break once in a while from decent sobriety and sink into the sultry arms of their primal humanity: Whether it is chocolate, love, wine or smoking – all the best things in life might kill you eventually but that will be nothing compared to the cruel suffering inflicted by a much more lethal poison: unadulterated, policy-compliant boredom.

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