Question

Consumer protection is an important issue, but how much responsibility should the government have in protecting consumer? There are many products that pose a health hazard yet are legal. Choose one of the following examples and explain whether or not you think that the government should ban the product.

• Cigarettes

Answer 1

One such product is Cigarettes. The adverse health impact of consumption of cigarettes is not hidden with all the researches and studies that have come up. Yet the government is reluctant in banning the product. The demand for cigarettes is relatively inelastic. Besides that the consumption demand can be divided into groups such as youngsters who have relatively elastic demand for cigarettes than the elderly who are kind of addict and also have higher purchasing power. The government should compare the costs and benefits from the alternatives for banning the product such as taxing at a higher rate. A higher tax on cigarettes will lower the demand for the young population and will also help generate the tax revenue for the government besides safeguarding the interests of the people associated with the tobacco industry which employs a good fraction of labour force and also forms share of agricultural GDP. Thus banning the product altogether may not be an immediate step that the government should take instead taxing it highly and increasing awareness about the ill effects that induce the demand to fall are better ideas.