The social costs of alcohol abuse in New Zealand

Abstract

Aims: This study updates and extends previous New Zealand research on the social costs of alcohol abuse.

Design: This economic cost study used the human capital approach.

Setting: New Zealand, 1991.

Participants: The total New Zealand population.

Measurements: The estimated cost of alcohol abuse for 1 year included direct and indirect costs. Costs such as lost production resulting from premature death and sickness, reduced working efficiency and excess unemployment comprised indirect costs. Direct costs included hospital costs, accident compensation payments, police and justice system costs. A range of social cost estimates was constructed based on various prevalence rates of alcohol abuse, discount rates for lost production and the excess unemployment rate.

Findings: Using a range of assumptions regarding the proportion of each event attributable to alcohol, the sum of social costs ranged from $1045 million to $4005 million in 1991. The direct costs ranged from $341 million to $589 million, respectively.

Conclusions: While providing an indication of the societal impact of alcohol abuse, these costs pertain to a relatively narrow range of alcohol-related effects. The paper identifies a number of areas where further research is required.