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Unhealthy Behavior – and what to do about it

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Health policy is arguably a very complex field - with many issues. Which begs the question: How to tackle unhealthy behavior in a sensible way?

Today, there is a core – and somewhat philosophical – division when talking about health costs, healthcare systems, and in general policymaking.
On the one hand, some believe that people should be forced to make the “right” decision. Whether that right decision is actually correct, science-based, and data-driven is of secondary importance to this group. Creating what is nothing short of a tautological monster, the decision is correct because it comes from a higher authority. Given the authority of the state (or of other institutions), they believe, the “ignorant” population should follow it. Paraphrasing, the state (and the people in it) know it better. If reading this you have found a worrying resemblance to what is called a dogma (defined as “a principle or set of principles laid down by an authority as incontrovertibly true.”) you would be correct. And if you are like me, you are also probably worried about what policymaking is bringing to our doors.

On the other hand, others believe that people’s freedom of choice is (or should) be a core principle of policy-making and that people need to be informed rather than forced into a certain position or behavior. I am part of this second group. I believe that history (and the data that comes with it) has shown time and time again that forcing people into a certain behavioral pattern has not only failed to produce beneficial results for society but has rather directly (and indirectly) damaged society – hence, the economy – in forms that are sometimes difficult to believe. History is littered with terrible examples of this. On the economic front, a simple literature review of the history of bans would show – without any doubt – that forcing people to change their behaviors does not work.

Discussing this is like discussing that the earth is the one moving around the sun, and not vice-versa. We can discuss it, of course, but would that be productive and conducive to anything more than an empty – and rather frustrating – conversation? What works (also in the case of solar system movements, which go well beyond my capabilities as an economist) is to share knowledge, information, and data. This would give the appropriate tools to everyone in society so that they can freely decide to make the right decision.

These different ways of thinking are nowhere more explosive than when talking about healthcare and its effects on the state budget. Today, we observe objectively worrying numbers in the consumption of harmful goods in Austria. These numbers are a fact, and anyone can see them.

However, while we all probably agree on the issue, some of us will move towards an ideological approach, while others will look for a pragmatic solution. The objective is to decrease health costs, which will allow the country to continue providing quality health services to the population. The question is how we achieve such a lofty objective. My answer is to use non-invasive policies to reduce social distortions.

These policies should focus on vulnerable groups, including lower-educated and low-income adults. Enhanced collaboration between public and private sectors mixed with better communication to consumers about health risks are key for an evidence-based policy approach. The consumer’ free will remains at the center of the picture, increasing the understanding at the base of consumption choices. This constructive policy approach is based on three pillars:

  • Implement Public Private Partnership Principles: Address risky behaviors creating partnerships and constant conversation between the public sector and the private industry.
  • People’s Empowerment: Strengthen the understanding of individual health by correctly communicating the respective health risks of products.
  • Incentivize Innovation: Incentivize the switch to better alternatives to reduce social distortions, and in turn boost further innovation by the private sector.

Read more here.

Author

  • Barbara Kolm

    Barbara Kolm is President of the Hayek Institut, Founding Director of the Austrian Economics Center and former Vice-president of the Austrian National Bank.

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The views expressed on austriancenter.com are not necessarily those of the Austrian Economics Center.

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