In early 2018 most major UK supermarkets such as Waitrose, Co
-op, Tesco, Asda voluntarily banned the sales of energy drinks to
children under the age of 16. This was due to studies that linked
energy drinks to health complaints and hyperactive behaviour
disrupting classes and potentially triggering violent outbursts.
Statistics show that 68% of 10-18 year olds and 18% of 3-10
year olds in the UK are consumers of energy drinks.
However, the question still stands. Has this ban been effective?
On the most part it has been effective, however BBC timeline
took a 15-year-old girl around eight shops in Glasgow and New-
ton Mearns, and out of those eight, three did not ask for identifi-
cation.
Another objective of the ban of the sale of energy drinks to un-
der-16’s is to reduce morbid obesity. The number of people
across England, Scotland and Wales diagnosed with morbid
obesity is expected to double to 5 million by the end of 2035
from the 1.9 million recorded in 2015, new studies show. In ban-
ning the sale of energy drinks to under-16’s it is part of a gov-
ernment drive to reduce childhood obesity hoping to cut the
number of obese children in half by the end of 2030. Which in
the long run will benefit the British economy as it was recorded
in 2014/2015 that £5.1 billion was spent by the NHS on obesity
related illnesses.
So you could perhaps see energy drinks as a demerit good (the
diagram here shows a good with negative externalities in con-
sumption, as the social benefit is less than the private benefit,
referred to as a demerit good). This could be due to consumers
being ignorant and continuing to consume these good that cre-
ate a negative “spill-over effect”, which is a negative effect on a
third party that is not the producer of the consumer. It could
also be due to information failure, which means that economic
agents do not have adequate information to make rational deci-
sions. By banning the sales of energy drinks to under-16’s a
large percentage of the population that will be able to get their
hands on these products will be reduced.
We have seen this done before with certain other demerit such
as alcohol and cigarettes. However, with those goods it was a
Energy Drinks:
Market Failure or a Misconception?
Dominic Kong
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