the aim of reducing the amount of smoking. In other words, the tax is imposed
as an inducement for people to stop smoking.
Adjustment Effects
Adjustment effects are so called because a person adjusts their position in
response to the law. There are two types of responses. In the case of a rule
providing beneficial consequences,
often as an incentive for certain desired
conduct, people may artificially bring themselves within the scope of the rule
to enjoy the consequences. This is the rationale for a good proportion of tax
and financial planning. In the case of a rule providing detrimental
consequences, persons seek artificially to locate themselves outside the scope
of the rule to avoid the consequences while at the same time reaping the
benefits which the rule is trying to prevent.
Derived Effects
Derived effects are effects that occur some way down the line from the law.
These are possible because the effects of a rule potentially go on for a long
time and can go in various directions. Hence, there will be many effects and
the likelihood is that some will be detrimental and unforeseen. Law can have
“wholly unanticipated and undesirable” side effects.
316
For example, one
consequence of making heroin illegal through the imposition of harsh penalties
is to increase the occurrence of house breaking because drug addicts have to
steal to support their habit. In fact, in the worst case a rule achieves an
opposite result to the one intended, and so worsens the problem or its
enactment solves one problem by creating another.
317
316
Beerworth (1980) p 67
317
Sunstein (1990)
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