Impact of Taxation on Goods of Addiction in Australia

Running head: ECONOMICS ASSIGNMENT
Economics Assignment
Name of the Student
Name of the University
Author Note

1ECONOMICS ASSIGNMENT
Table of Contents
Introduction......................................................................................................................................2
Essence of the Article......................................................................................................................3
Economic Interpretation..................................................................................................................3
Conclusion.......................................................................................................................................6
References........................................................................................................................................7

2ECONOMICS ASSIGNMENT
Introduction
Economics as a discipline has evolved considerably over time with continuous
development and modifications in its conceptual framework, much of which can be attributed to
the real world problems and issues in the economies across the globe which have evolved with
time. Of the different building blocks of the theoretical and conceptual framework of economics,
the primary ones are that of the concept of market, demand and supply as well as the elasticity of
demand of different commodities and services (Baumol and Blinder 2015).
In economics, the term “Market” refers to the open forum where the buyers and the
sellers of different commodities and services interact with each other to decide the quantity of
the commodities or services which are required to be produced as well as the price of the same.
The buyers representing the demand side and the sellers representing the supply side, the demand
and the supply forces thus play crucial role in determining the structure and the dynamics in the
market (Frank and Cartwright 2013). On the other hand, the demand for all the products are not
of same type and the governing bodies of different countries often impose price and quantity
restrictions or regulations in different markets, which in turn have considerable impacts on the
dynamics in the same.
Keeping this into consideration, the concerned report tries to analyze the impact of
government restriction in the form of taxation in the market for goods of addiction like tobacco,
cigarettes and wine, specifically in the economic domain of Australia, in the light of the
economic theories as discussed above. To analyze and interpret the impacts of taxation on such
goods and its effects on the demand pattern of the same, the concerned report refers to the article
named, why the cigarette tax won’t stop people from smoking (NewsComAu 2018).