Research & Decision-Making for Business

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Business Research Report

 Research & Decision-Making for Business



  1. Executive Summary

The purpose of this report is examining the alcohol consumption in Autralia in order to assist business to realise the problem then make the decision for their business.

This report discusses about the increase or decrease of the alcohol consumption in Australia, the campaigns which the Gorvernment implement in order to against the development of alcohol consumtion. Moreover, it is vital to discover the relationship between alcohol consumption and health. Finally, this paper will present the effects of alcohol consumption on the economics.

Even though this report present some limitations and not up-to-date data, it discusses about some important problem related the alcohol consumption.

The above findings might provide the important information about alcohol consumption then we can see the positive and negative that alcohol consumption bring to.

  1. Problem Statement & Research Objectives

Most Australians have tried alcohol at some time on their way of life. People use alcohol for a lot of different reasons such as sociability, cultural participation, and religious observance or as a result of peer influence. Moreover, they drink for pleasure , relaxation, mood alteration, enhanced creativity, intoxication, addiction, or habit... Recent cowardly attacks on Australian streets referred to as “King Hits” or “Coward Punches” has brought into focus alcohol consumption and social issues that seem to follow it. The Australian Bureau of Statistics (ABS) estimates the consumption of alcohol bases on the availability of alcoholic beverages. Then it estimates the quantity of pure alcohol consumption such as beer, wine, spirits and Ready to Drink (pre-mixed) beverages (RTDs) and plus estimates of the total volume of beer and wine. The data of the quantity of pure alcohol available for consumption from cider are included from 2004-05 onwards. According to National Health and Medical Research Council (NHMRC) of Australian Government, even though most Australians who drink alcohol do so at levels have few adverse effects, any level of drinking increases the risk of ill-health and injury. Hence, alcohol consumption is associated with a variety of adverse health consequences such as liver cirrhosis, mental illness, several types of cancer, pancreatitis, and fetal growth retardation. Moreover, economics was affected negative because of alcohol consumptions.

Hence, this report will focus on analysing the Alcohol consumption in Australia and what effect of alcohol for people, health, and economics.

The final purposes of this report are:

  • To identify the alcohol consumption that increase or decrease in Australia.
  • To investigate that the relationship between alcohol consumption and health.
  • To investigate that the economic gains of achieving reduced alcohol consumption targets for Australia.
  1. What is Already Known about the Decision or Problem

A literature review is a process which consist of information, ideas, data and evidence from a particular standpoint in order to fulfill certain aims or express views on the nature of the topic and how it is to be investigated, and the effective evaluation of these documents in relation to the research being proposed (Sekeran & Bougie, 2014, p.49).

Hence, the first research tool used to collect relevant information has been the Internet research which is already know such as “google”, however, the information on the Internet is not significant reliable due to the references even though the materials found seems to be quite relevant. In addition, JCU database has finally provided useful information but some journal article is not up-to-date.

Among all, the ones that may help the most to clarify the core problem of this report are:

  • Anne W Taylor (2013), Is alcohol consumption in Australia increasing or decreasing?, Australia and New Zealand Journal of Psyhiatry, 47 (12), 1199-1200.
  • Michael Livingston and Claire Wilinson (2012), Per-capita Alcohol Consumption and All-cause Male Mortality in Australia 1911–2006, Alcoholism, 48 (2), 196-201.
  • Magnus, Anne; Cadilhac, Dominique; Sheppard, Lauren; Cumming, Toby; Pearce, Dora; Carter, Rob (2012), The Economic Gains of Achieving Reduced Alcohol Consumption Targets for Australia, Am J Public Health, 102(7), 1313–1319.

The first article shows its relevance with the problem state since beginning. It describes that the alcohol consumption has decreased between 2009/2010 and 2010/2011 based on Australian Bureau Statistics (ABS). This was the first decrease since 2001/2002. This data source includes alcohol produced for domestic and for import. This figures shows that there was a decrease from 13.1 litres of pure alcohol per Australian (aged 15 years or older) in 1974/1975 (ABS, 2011) to 10.0 litres (ABS, 2012). Furthermore, in the Australian Health Survey (2011-2012) over 20,000 people, the number of adults went down from 85.5% in 2007/2008 (ABS, 2009) to 82.4% in the periods 12 months (ABS, 2012). To summarise this article; due to the campaigns, interventions and policies at reducing harmful alcohol consumption and the media often highlight the negative aspects of alcohol; consumption in Australia trends to be decreasing.

The next article focuses on the variety of relationships between alcohol consumption and health (both positive and negative). This study shows that the effect of per-capita alcohol consumption on male mortality is positive and significant - 1litres increase (decrease) in per-capita consumption of pure alcohol is associated with 1.5% increase (decrease) in male mortality. In addition, this article determines that the youngest age group (15-29 years old) is affected strongest by per-capita alcohol consumption on male mortality with 1 litre increase in consumption associated with 12.5% increase in mortality. To conclude, this study has established that the amount of alcohol consumed at the population level in Australia is significantly associated with total male mortality. Hence, per-capita alcohol consumption in Australia contributed to rate of male mortality, especially among young people. The government offers the policies to reduce population-level alcohol consumption in order to improve population-health outcomes in Australia.

The final article investigates the economic gains of achieving reduced alcohol consumption targets for Australia. Based on the article, they estimated the economic benefits to health, production, and leisure of realistic target reduction in per-capita annual adult alcohol consumption in order to inform prevention policy. Australia has strong history of alcohol consumption control. This includes 3 main approaches to the issue:

  • To restrict sales of alcohol to underage (younger than 18 years old) person, to license alcohol sales outlets, to allow police test alcohol breathe of drivers of vehicles (legal limit of blood alcohol is 0.05g/100ml, and restrict to advertise alcohol.
  • To adopt the taxation of alcohol product in order to reduce demand.
  • To use the social media to alert and inform consumers of alcohol about the dangers of driving under influence of alcohol.

More recently, in order to reduce the negative health consequences of high-risk alcohol consumption and harmful drinking behaviour, the National Preventative Health Taskforce in Australia has extended regulation and taxation. The value role of regulation, taxation and recommendation of measure was defined in order to increase the preventive effort on

  • Health.
  • Production (workforce and household).
  • Leisure.

In order to investigate this study, they implemented a process:

  1. Choose a target of 6.4 litres annually per-capita on average.
  2. Model lifetime health benefits such as fewer incident cases of alcohol-related disease, death, and disability adjusted lifetime.
  3. Estimate production gains with surveyed participation and absenteeism rates.
  4. Valued gains with friction cost and human capital methods.
  5. Estimate and valued household production and leisure gains from time-use surveys.

The final result shows that:

  • Reduce 3.4 litres of alcohol consumption per-capita
  • One third incident cases of disease (98,000), deaths (380), working days lost (5 millions), production lost (54,000), and reduce $789 million health sector cost.
  • Increase $ 427 million when using the friction cost method.

In conclusion, it may be substantial to save economics and health benefits when reducing alcohol consumption-particularly in the health sector with reduced alcohol-related disease and injury.

  1. Concept Framework & Research Questions

The all idea of this report is to investigate the alcohol consumption increase or decrease, the relationship between the alcohol consumption and health, and the economic gains of achieving reduced alcohol consumption targets for Australia and give the solution.

Particularly, research idea is structured as follows:

By investigating the variables influencing, we will find some characteristics to improve the existing literature and in approaching alcohol consumption. Thus, the research questions are:

  1. What is the advantage about people’s health if using limited alcohol?
  2. What are the factors that influence the economics positively due to alcohol consumption?
  3. Which media is developing in order to popularise the alcohol’s effective for reducing alcohol consumption?
  1. Secondary Data Analysis – Results and Discussion

The simple descriptive analysis that follows is based on data collected in 2014 by ABS. According to the data, due to the total available for consumption, there was a significant increase from 67,703 thousands litres (1960/1961) to 183,597 thousands litres (2012/2013); however, in the period from 2008/2009 to 2012/2013, it trended to decrease from 184,304 thousands litres to 183,597 thousands litres. Moreover, through the decade, the alcohol consumption increases significantly; particularly in the period 1991/2000 to 2001/2013. Following the ABS data, the per-capita consumption from 1960/1961 to 2012/2013 is stable – 9.34 litres (1960/1961) and 9.88 litres (2012/2013); however, it reached to the peak in the period 1974/1975 with 13.09 litres. From this data, the alcohol consumption in Australia is trending to decrease because of Australia Government’s policy and efforts.

Figure 1. Total alcohol available for consumption (‘000 litres).

The next simple descriptive analysis is based on data collected in 2012 about the relationship between per-capita consumption and male Mortality (1911-2006). Alcohol is ranked in the top four risk factors in the global burden of disease (Rehm et al., 2006). The results of the time-series analysis of total mortality are presented in table below:

Table 1. Semi-logarithmic ARIMA model of the estimated effect of alcohol consumption on all-cause male mortality, controlling for female mortality and cigarette consumption, 1911–2006, Australia

Effect (β)

Standard error

Alcohol consumption (l)

0.015***

0.004

Female mortality

0.920**

0.045

Cigarette consumption (kg)

0.031

0.021

War years

−0.004

0.008

1919 Flu

−0.002

0.037

Constant

0.0003

0.001

PortmanteauQtest for residual autocorrelation (5 lags)

Q= 3.608 (P= 0.607)

Model specification

(0,1,1)λ= 0.0

  • **P< 0.01, *P< 0.05 and (*)P< 0.10.

Based on the Table 1, the effect of per-capita alcohol on male mortality is significant. Each 1 litre increase (decrease) in per-capita is associated with 1.5% increases (decrease) in male mortality (Effect (β) of alcohol consumption is 0.015). Moreover, burden of alcohol is related disease and injury. According to NHMRC, 3.3% of the total burden of disease and injury in Australia in 2003 was accounted by alcohol consumption. Between 1992 and 2001, more than 31,000 deaths were attributed to risky or high-risk alcohol consumption. Above the NHMRC 2001 guideline levels, almost 600 die every year from injury and disease among 65-74 year-old because of alcohol. To sum up, alcohol is second casued of death and hospitalisation after tobaco.

The last simple descriptive analysis is based on data about the effect of alcohol to economics. Following the data, potential opportunity cost saving of $789 million to health sector, $427 million in workforce production (FCA), and $ 21 million in home-based production could be achieved. The table 2 (below) will present the full economic benefits modeled including 95 % uncertainty intervals for the point estimates in health status for each of the ideal and progressive alcohol consumption targets.

Table 2. Finacial Outcomes of a Reduction in Litres of Alcohol Consumed Pre-capita: Australia, 2008

The total opportunity cost savings are the sum of the health sector offsets and the combined workforce, household, and leisure-production effects. Taxation is treated as a tranfer payment and should not be added to production effects or health sector offsets. The magnitude and distribution of avoidable economics costs associated with reducing alocohol consumption. The opportunity cost saving are largest in the health sector, based on gains in workforce, and increase from the reduction of alcohol-related disease, deaths.

  1. Implications for the Business Decision or Problem

This literature review and secondary data analysis are still limited and not up-to-date. Few are the limitations the report came across through its development:

  • The data provided were collected from 2006 (Per-capita Alcohol Consumption and All-cause Male Mortality in Australia ), so it is not up-to-date.

Per-capital alcohol consumption and all cause male mortality in Australia is increase or decrease from 2006 until now?

  • The data provide the number of adults who use the alcohol however it is not specific about the age group and the alcohol consumption for each age group.

In conclusion, this report developed some important information such as:

  • The decrease and increase of alcohol consumption in Australia from the past until 2013.
  • The policy and taxation of Government in order to restrict the gain of alcohol consumption.
  • The relationship between effects of alcohol and population-health.
  • The effect of alcohol consumption on the economics, health sector cost...

  1. References

National Health and Medical Research Council (2014). Retrieved from https://www.nhmrc.gov.au/your-health/alcohol-guidelines/alcohol-and-health-australia

Australia Bureau of Statistics (2014.). Retrieved from http://www.abs.gov.au/ausstats%5Cabs@.nsf/mediareleasesbyCatalogue/8EC1516064FDA974CA25772F001F6C69?Opendocument

Sekeran, U., & Bougie, R. (2014). Research Methods for Business: A Skills Building Approach (6th ed.). Wiley.

Anne W Taylor (2013), Is alcohol consumption in Australia increasing or decreasing?, Australia and New Zealand Journal of Psyhiatry, 47 (12), 1199-1200. http://anp.sagepub.com.elibrary.jcu.edu.au/content/47/12/1199#ref-list-1

Michael Livingston and Claire Wilinson (2012), Per-capita Alcohol Consumption and All-cause Male Mortality in Australia 1911–2006, Alcoholism, 48 (2), 196-201. http://alcalc.oxfordjournals.org.elibrary.jcu.edu.au/content/48/2/196.full.pdf+html

Magnus, Anne; Cadilhac, Dominique; Sheppard, Lauren; Cumming, Toby; Pearce, Dora; Carter, Rob (2012), The Economic Gains of Achieving Reduced Alcohol Consumption Targets for Australia, Am J Public Health, 102(7), 1313–1319. http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3478010/

RehmJ,RoomR,MonteiroM,et al Alcohol as a risk factor for global burden of disease.Eur Addict Res2003;9:157-64.

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