The fine line between tobacco control and a flowering black market

Taxes on cigarettes, while not universally welcomed, are often grudgingly accepted because of the acknowledgement that smoking is dangerous, both to one’s own health and to non-smokers. The ability, however, to balance the cost of consumption and an individual’s freedom to smoke remain finely nuanced, with over-taxation (as well as prohibition) often resulting in far worse outcomes. While sin tax increases are inevitable, it seems that these increases are spawning a range of unintended (but not unexpected) consequences.

The economics of shrinkflation

Numerous firms confronted by rising inputs costs and a resistant consumer are ‘shrinking’ products as means of increasing prices. This widespread concept of ‘shrinkflation’ has become a legitimate business practice for companies in South Africa. Normally a price increase would result in a rational consumer decreasing the purchase of the good or substituting it for another product, or even purchasing more (and forsake others) if it was needed for survival.

Should Nigeria instead of South Africa be Africa’s representative?

On 6 April 2014, Nigeria replaced South Africa as the largest economy in Africa in terms of Gross Domestic Product. However, many analysts argue that such claims do no harm to South Africa’s status within and outside of the continent. South African GDP per capita is more than twice that of Nigeria; and South Africa has superior infrastructure, a more sophisticated financial sector, and even better social indicators.

Rising state wage bill might crowd out critical public services

Much has already been written on the impact that rising personnel costs might have on government’s capital investment plans. What has perhaps been neglected is that within departments, attempts to curtail overall expenditure are much more likely to lead to cut-backs in operational costs.