Getting in the spirit?

Think tank: Social Market Foundation

Author(s): Aveek Bhattacharya

February 9, 2023

This report from UK think tank the Social Market Foundation looks at alcohol and the Scottish economy.

This report from Social Market Foundation think-tank analyses the relationship between alcohol and the Scottish economy, as the Scottish Government is currently consulting on a range of regulations on alcohol marketing to reduce harmful drinking. Our analysis finds that such regulation is unlikely to have much of an effect on the Scottish economy, since so much of Scottish alcohol production – most notably whisky – is sold abroad. If other countries chose to follow the Scottish lead and implement policies to reduce their own drinking, it would shrink some of those lucrative whisky export markets. That said, such arguments are pretty speculative, and, frankly, probably overstate Scotland’s influence in the world. The domestic sector of the industry – around 40,000 jobs in hospitality and retail – will likely be affected, but will at least partly be offset by other sectors’ gains. In some cases, it might be the same businesses making the pivot – as we have seen with pubs shifting towards selling food. The overall effect of these shifts in spending on the economy is likely to be modest. At the same time, lower alcohol consumption brings economic benefits. The cost to the Scottish economy of alcohol-related sickness, unemployment and the loss of workers through premature death is estimated to be £1.2 billion. If effective, the marketing restrictions offer a chance not just to avert human tragedies, but to claw some of that economic value back.