Smoking bans aren’t worth the expense

As of this week, cigarette aficionados in Quebec and Ontario will have fewer places to light up, as all bars and restaurants become subject to provincial smoking bans. As smokers butt out and the state butts in, it’s a good time to review the economic implications of these increasingly common prohibitions.

First, smoking bans have a negative effect on the hospitality industry.

According to a 2005 study involving several Ontario cities where municipal bans were imposed, sales at bars and pubs were 22.5% lower than before the new rules. A study commissioned in 2006 by the City of Windsor reveals that city stands to lose up to $225 million annually in tourist spending after the June ban takes effect. And a provincial government report estimates that Ontario’s gaming industry could lose up to $500 million province-wide when casinos forbid smoking.

Second, smoking bans in restaurants and bars not only trample property rights, but distort market forces which would just as effectively separate the smokers from the non-smokers.

Why not allow ventilated smoking rooms, with patrons free to choose whether or not to sit in the designated room? Or allow restaurants for smokers or non-smokers only? There are many civilized compromises that respect personal choice.

The key is allowing the market to respond to consumer demand. There is a reason restaurant owners spend tens of thousands of dollars apiece building smoking rooms – because it is good for business, allowing the establishment to serve a broader range of clientele.

Third, smoking bans hurt the very people they are designed to help: restaurant workers exposed to second-hand smoke.

By damaging the restaurant sector, there will be fewer jobs available. Anti-smoking activists will argue that this doesn’t matter, that nobody should be forced to breathe in second-hand smoke on the job. But if smoking rooms or designated establishments were created, nobody would be either. Workers who do not like smoke would be free to work in non-smoking establishments or sections, while other workers may choose to work in smoking establishments.

From an economic perspective, one cannot justify denying adult workers this type of choice. We don’t prevent people from becoming firemen, policemen, miners, or stuntpeople because they could get injured or even killed on the job. What the job market does is compensate them for the risks they assume.

While it may not seem pleasant to measure these things, a study published in 2004 in the journal Economic Inquiry estimates that, between 1992 and 1997, male workers in the United States obtained US$60 more per year for each increase of 0.001 per cent in the risk of death at work during the year. If fewer waiters chose to serve rooms filled with smokers, this would reduce the labour supply for the job, requiring employers to pay a ‘risk premium’ to make the work attractive.

Finally, the key word here is risk. To this day there is no evidence that second hand smoke causes lung cancer. Common sense tells us that exposure to smoke of any kind – exhaust from cars, cigarette smoke, smoke from a wood-burning oven or barbeque – is not healthy. It may increase your risk of lung diseases, but it does not guarantee that you will get sick.

So many of us continue to assume certain risks. We breathe the polluted air in our cities, gather around outdoor cookouts, and, yes, occasionally inhale second-hand cigarette smoke.

There is nothing wrong with the government minimizing the impact of self-destructive lifestyles when they clearly result in harm to other people. It is reasonable to forbid drunk people from driving, when alcohol is a direct factor in thousands of traffic fatalities. It is not reasonable to prevent people from smoking in enclosed spaces when the principal victims of their habit are themselves, and when no clear link can be established between their behaviour and its effects on others.

Our Charter of Rights allows the government to infringe on our liberties as long as the infringement is reasonable within the limits of a free and democratic society. The Ontario and Quebec smoking bans patently fail this reasonableness test.

The Supreme Court recently ruled that it’s ok for people to pay to engage in group sex in an establishment (a risky activity if there ever was one). Yet it is now illegal for them to enjoy a cigarette with their martini. It should be really interesting if the smoking ban is challenged in court, as a group of Quebec bar owners are proposing to do.

Smoking bans make neither economic nor common sense. Maybe it’s time to ban them, instead of smoking.

Tasha Kheiriddin is the Executive Vice President of the Montreal Economic Institute.