Foetal Alcohol Spectrum Disorders may be costing New Zealand up to $200 million a year in productivity through affected workers.
The research finding, published in New Zealand Medical Journal, estimates that about 24,000 working people have the disorder, which results from pregnant mothers drinking alcohol and causing permanent cognitive damage.
Economist and study author Brian Easton said as people with the disorder did not work as well, it cost the country between $49 million and $200m.
"The real conclusion is not that this figure is large - it is - but in principle it's avoidable. Pregnant women don't have to drink. If they don't drink, the child will be born without FASD."
Brian Easton said the research showed it was on the right path but was hopelessly underfunded.
The government has launched a $12m campaign to help tackle the disorder.