Economic evaluation (Cost-Benefit Analysis CBA, Cost-Effectiveness Analysis CEA) is tool used to help decision makers allocate scarce resources in the most efficient way. You were requested to set up a smoking cessation clinic work in your organization i) determine the CBA/ CEA for providing this service, and ii) what factors will you need to take in consideration?

Answer:

The smoking cessation programme evaluates the percentage of participants who stopped the smoking behaviour at least 6 months or a definite period. The benefits incurred through this are the reducing cost of insurance and increase the saving habit among the participants who stopped smoking. The cost occurred are the opportunity cost of the participants. From social perspective, the well being and standard of living of the people increased. At the same time the welfare also increased. The employment opportunities and productivity of the firms increased. There is a lowering risk of diabetes created and the life expectancy increased among the participants. The rising productivity raises national income and real GDP. On the other hand, the cost incurred through this are the cost of awareness programmes and the remedial products which should be used by the participants who stop smoking.
The factors which need to consider are the income level of the participants, taste and preference of the consumers, employment and job environment etc. Comparing the monthly income of the participants before and after the smoking process will help to analyse the living standard and welfare of their family. The friend circle and peer group influence also considered under this situation. The health measures and medicines taken by the participants will help to find the intensity level of the participants towards smoking. The cost of smoking related to the excess cost approach.