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Do Higher Tobacco Taxes Reduce Adult Smoking? New Evidence of the Effect of Recent Cigarette Tax Increases on Adult Smoking
Abstract
There is a general consensus among policymakers that raising tobacco taxes reduces cigarette consumption. However, evidence that tobacco taxes reduce adult smoking is relatively sparse. In this paper, we extend the literature in two ways: using data from the Current Population Survey Tobacco Use Supplements we focus on recent, large tax changes, which provide the best opportunity to empirically observe a response in cigarette consumption, and employ a novel paired difference-in-differences technique to estimate the association between tax increases and cigarette consumption. Estimates indicate that, for adults, the association between cigarette taxes and either smoking participation or smoking intensity is negative, small and not usually statistically significant. Our evidence suggests that increases in cigarette taxes are associated with small decreases in cigarette consumption and that it will take sizable tax increases, on the order of 100%, to decrease adult smoking by as much as 5%.
... However, several recent studies examining the associations between increased cigarette taxes and decreased smoking have challenged this consensus. Although some have confirmed the previously reported link (Cotti, Nesson, & Tefft, 2016;Goldin & Homonoff, 2013), others have found the relationship to be weak or nonexistent (Callison and Kaestner, 2014). Our study contributes to this conversation by re-evaluating the relationship between cigarette taxes and prices and current smoking in the U.S. population using multiple measures of tax and price in a large nationally representative dataset collected between 2003 and 2015. ...
... A second explanation for the inconsistency of tax effects in current studies could be due to improvements in statistical methods used in this area of study, as Callison and Kaestner (2014) argue. The authors show that the association between cigarette taxes and smoking participation and intensity is negative but small, and typically not statistically significant. ...
... It has become accepted wisdom in the public health community that increases in tobacco taxes are associated with decreases in cigarette smoking (2018 Global progress report on implementation of the WHO Framework Convention on Tobacco Control, 2018). Recent work has taken an issue with our understanding of the relationship between cigarette taxes and smoking, and argued that the evidence for a positive effect of tobacco taxes on today's adult smoking in the United States is weak, and even that strong evidence of their positive effect on adult smoking may have never existed (Callison & Kaestner, 2014). We contributed to this debate by using a large nationally representative dataset to re-evaluate the associations between cigarette taxes and adult smoking in the U.S. population. ...
Increasing cigarette taxes has been the cornerstone of tobacco control policy. Recent work has argued that raising cigarette taxes alone may no longer be an effective strategy for lowering smoking rates. We largely confirm these findings but also find that increases in price continue to predict lower smoking participation in most model specifications. We argue that raising cigarette prices via taxation remains an effective public health policy. We discuss the advantages of homogeneous tax environments and minimum price laws for eliminating opportunities for consumers to offset tax increases by searching for lowest taxes.
... In addition, heated tobacco products can also be attributed to "smokeless tobacco products", the consumption of which does not involve the combustion process. The latter category includes chewing tobacco, sniffing tobacco and tobacco for oral use 10 . With the development of the electronic cigarettes market, the term "market of tobacco products and nicotine-containing products" becomes more used. ...
... URL: https://ec.europa.eu/ taxation_ customs/sites/taxation/files/10-02-2020-tobacco-taxation-report.pdf?fbclid=IwAR1uqPEEeWpOAQsnJmY3ngW1P7uFKPCRi2m Wu mz9 GXX9CZWptBEmmO9JJgc. 34 -Council Directive 2011/64/EU dated 21 June 2011 on the structure and rates of excise duty applied to manufactured tobacco (codification) within 2 years from the date of entry into force of the Agreement (except for Articles 7(2), 8,9,10,11,12,14(1), 14(2), 14(4), 18, 19, the implementation schedule for which will be established by the Association Council later). The exceptions also apply to tax rates. ...
... URL: https://ec.europa.eu/taxation_customs/sites/taxation/files/report_excise_ duty_manufactu-red_tobacco_12012018_en.pdf.10 On the approximation of laws, regulations and administrative provisions of the Member States concerning the manufacture, presentation and sale of tobacco and related products and repealing Directive 2001/37/EC. ...
Irpin 2020 2 UDC 336.226.331-047.64 (477) LBC 65.9(4Ukr)261.411.1 This work covers the challenges of excise duty collection from tobacco products and nicotine-containing products, driven by the tobacco market development. It also studies the in-depth theoretical basis of excise taxation of heated tobacco products and e-cigarettes in the context of achieving fiscal and regulatory goals. It describes the types and general approaches to the classification of novel tobacco products and nicotine-containing products. This research determines the tendencies and features of excise duty collection from heated tobacco products and e-cigarettes in EU countries in terms of broader distribution of these products on national markets. It describes specific aspects of the tobacco products excise policy in Moldova and Georgia. It also analyzes the specifics of the transformation of domestic tobacco products market due to the high excise duty burden carried by these products. The work also proposes ways of improving excise taxation of heated tobacco products and e-cigarettes in Ukraine to pump up the budget and regulate the tobacco market development. The survey findings can be useful to the state agencies and a broad range of other stakeholders when developing proposals regarding the formation and implementation of the excise policy for tobacco products and alternatives. UDC 336.226.331-047.64 (477) LBC 65.9(4Ukr)261.411.1 T44 ISBN 978-617-7600-91-5
... Cotti et al. (2016) use household scanner data from 2004 to 2012 to calculate a tax elasticity of −0.16. Similarly, Nesson (2017) finds an elasticity of −0.15 using the 1988 to 2012 National Health and Nutrition Examination Surveys; Bishop (2018) documents an elasticity of −0.18 using 1999 to 2012 BRFSS data; and Callison and Kaestner (2014) estimate an elasticity range from −0.06 to −0.03 using the 1995 to 2007 Current Population Survey Tobacco Use Supplements (TUS). ...
... To implement the event study, we replace the traditional cigarette tax rate with an indicator variable for if the traditional cigarette tax increased by $0.50 or more at any point during the study period following; we refer to such a change as a large traditional (Callison and Kaestner 2014). 15 For the e-cigarette tax, we construct an indicator that divides the study period into a pre-and post-tax effective period for adopting localities, non-adopting localities are coded zero. ...
... Given a mean traditional cigarette state excise tax rate of $1.54, these estimates imply a modest own-tax elasticity of demand of −0.01 for current smoking and − 0.09 for daily smoking. 17 We note that our traditional cigarette tax elasticity estimates are reasonably close to Callison and Kaestner (2014), who report elasticities in the range of −0.03 to −0.06. However, our estimates are somewhat lower than other more recent estimates ranging from −0.15 to −0.18 documented by Cotti et al. (2016); Nesson (2017); and Bishop (2018). ...
We study the effects of traditional cigarette and e-cigarette taxes on use of these products among adults in the United States. Data are drawn from the Behavioral Risk Factor Surveillance System and National Health Interview Survey over the period 2011 to 2018. Using two-way fixed effects models, we find evidence that higher traditional cigarette tax rates reduce adult traditional cigarette use and increase adult e-cigarette use. Similarly, we find that higher e-cigarette tax rates increase traditional cigarette use and reduce e-cigarette use. Cross-tax effects imply that the products are economic substitutes. Our results suggest that a proposed national e-cigarette tax of $1.65 per milliliter of vaping liquid would raise the proportion of adults who smoke cigarettes daily by approximately 1 percentage point, translating to 2.5 million extra adult daily smokers compared to the counterfactual of not having the tax.
... 41-43). For example, using data from the Tobacco Use Supplement to the Current Population Survey for the period 1995-2007, Callison and Kaestner (2014) found that a 10 percent increase in the cigarette tax is associated with a 0.2 to 0.4 percent decrease in smoking participation among adults ages 35-54. DeCicca et al. (2020) conclude that most studies estimate price elasticities of adult smoking participation between -0.1 and -0.3. ...
... A large literature provides evidence that, while cigarette taxes in adulthood reduce adult smoking, the magnitude of this effect is small, with most studies producing elasticities in the range of -0.1 to -0.3(DeCicca and McLeod 2008;Callison and Kaestner 2014;DeCicca et al. 2020). ...
... Taxation is one of the most effective strategies used by governments to reduce smoking rates (National Center for Chronic Disease Prevention and Health Promotion (US), 2014; World Health Organization, 2019). The evidence shows that increases in the price of tobacco products are particularly effective among a) smokers, to stimulate cessation (e.g., Bader et al., 2011;Sharbaugh et al., 2018) or reduce consumption (e.g., Callison & Kaestner, 2014); b) quitters, to avoid any relapse (e.g., Tabuchi et al., 2017); and c) non-smokers, by preventing them from starting smoking (Lynch & Bonnie, 1994). The WHO Framework Convention on Tobacco Control highlighted the importance of this policy, recommending that governments increase the prices of tobacco products to improve the health of their citizens (World Health Organization, 2003). ...
... Taxation is one of the most effective strategies used by governments to reduce smoking rates (National Center for Chronic Disease Prevention and Health Promotion (US), 2014; World Health Organization, 2019). The evidence shows that increases in the price of tobacco products are particularly effective in terms of stimulating cessation, reducing consumption, avoiding any replacement, and preventing people from taking up smoking (Bader et al., 2011;Callison & Kaestner, 2014;Lynch & Bonnie, 1994;Sharbaugh et al., 2018;Tabuchi et al., 2017). In 2018, the tax share of the retail price of the most popular brand of cigarettes in Australia was 77.5% (World Health Organization, 2019). ...
... Taxation is one of the most effective strategies used by governments to reduce smoking rates (National Center for Chronic Disease Prevention and Health Promotion (US), 2014; World Health Organization, 2019). The evidence shows that increases in the price of tobacco products are particularly effective among a) smokers, to stimulate cessation (e.g., Bader et al., 2011;Sharbaugh et al., 2018) or reduce consumption (e.g., Callison & Kaestner, 2014); b) quitters, to avoid any relapse (e.g., Tabuchi et al., 2017); and c) non-smokers, by preventing them from starting smoking (Lynch & Bonnie, 1994). The WHO Framework Convention on Tobacco Control highlighted the importance of this policy, recommending that governments increase the prices of tobacco products to improve the health of their citizens (World Health Organization, 2003). ...
... Taxation is one of the most effective strategies used by governments to reduce smoking rates (National Center for Chronic Disease Prevention and Health Promotion (US), 2014; World Health Organization, 2019). The evidence shows that increases in the price of tobacco products are particularly effective in terms of stimulating cessation, reducing consumption, avoiding any replacement, and preventing people from taking up smoking (Bader et al., 2011;Callison & Kaestner, 2014;Lynch & Bonnie, 1994;Sharbaugh et al., 2018;Tabuchi et al., 2017). In 2018, the tax share of the retail price of the most popular brand of cigarettes in Australia was 77.5% (World Health Organization, 2019). ...
About one in every two smokers dies from smoking-related causes every year. In response to this, over the past four decades, numerous countries have introduced successful tobacco control policies. Despite this, smoking persists, especially among more disadvantaged social groups. The relatively long history of smoking cessation policies allows for a better understanding of what works, what does not, why, and how. However, the social, cultural, and regulatory complexity of smoking prevents any straightforward replication of successful policies within a different context. Yet, sound scientific research allows for the construction and verification of hypotheses about how to replicate cessation elsewhere. Australia constitutes an ideal case-study through which to achieve this aim. This is because Australia is a leading country in tobacco control, despite people have easier access to nicotine through traditional tobacco products than they do via the use of Electronic Nicotine Delivery Systems, despite the latter being less harmful than the former. These features, combined with the abundance of empirical studies on the country, allow for a sound and comprehensive policy analysis.
... Given that there exists a sufficient within variation in cigarette taxes across units, theoretically the post-2000 studies should improve upon the pre-2000 studies as unobservables such as anti-smoking sentiments are accounted by the unit fixed effects as long as the sentiments are time invariant during the span of the study. The majority of the post-2000 studies find that encouraging trends in smoking outcomes can be attributed to increases in cigarette taxes (prices) (Adda and Cornaglia (2006), Tauras et al. (2007), Carpenter andCook (2008), DeCicca et al. (2008), Harding et al. (2012), Cotti et al. (2016), Nesson (2017), Bishop (2018), Cotti et al. (2018), Pesko et al. (2020)), with a handful of studies showing small or non-existent effect (Callison and Kaestner (2014), Hansen et al. (2017)). ...
This study reassesses the efficacy of cigarette taxation in curtailing smoking by leveraging recent advancements in the difference-in-differences (DiD) literature to account for heterogeneous treatment effects. Using data from the Behavioral Risk Factor Surveillance System Selected Metropolitan/Micropolitan Area Risk Trend (BRFSS SMART) for the sample periods 2004-2010 and 2015-2020, the study reveals three key findings. Firstly, the TWFE estimate for the 2004-2010 sample is only 48% of the average treatment effect on the treated (ATT) estimate obtained through the DiD framework. Secondly, event-study-type estimates demonstrate a gradual increase in magnitude following the treatment year, highlighting dynamic treatment effects overlooked by the TWFE estimate. Third, the ATT estimate for the 2015-2020 sample is approximately 66% of the ATT estimate for the 2004-2010 sample. Overall, the study underscores the potential bias toward zero in elasticity estimates when relying solely on TWFE models.
... To estimate the relationship between tax increases and cigarette consumption, a unique paired difference-indifferences approach was employed. Estimates indicate that, among adults, the association between cigarette taxes and either the participation in smoking or the intensity of smoking is negative, minimal, and normally lacks statistical significance (Kaestner, 2014). ...
The consumption of detrimental products, such as cigarettes, has a significant impact on health financing. Smoking is a detrimental practice that has negative effects on health, and the medical expenses linked to smoking-related ailments are considerable. In response, many countries have established cigarette excise laws with the aim of mitigating the adverse effects of smoking on public health and health financing. The implementation of cigarette excise taxes has resulted in a notable reduction in cigarette consumption, an increase in government revenue, and the funding of health programmes. This study aimed to enhance the understanding of the role of tobacco excise laws in promoting sustainable health financing. This study involved the review of 8 papers, and it was conducted following the guidelines of PRISMA-P, 2015 for systematic reviews. A comprehensive literature search was conducted utilizing multiple databases, including PubMed, EBSCO, and ScienceDirect. The tobacco excise management policy has generally aligned with its intended objectives. However, certain aspects, such as reducing consumption, allocation amounts, tariff patterns, and burdens, have yet to be fully effective. Therefore, it is necessary to implement strategic measures to enhance adequacy, such as increasing the pattern of excise tariffs and allocations and ensuring accountability and transparency in implementation.
... O mercado de produtos à base de tabaco é complexo, envolvendo diversos fatores socioeconômicos, institucionais e comportamentais, os quais devem ser considerados na formulação de políticas para mitigar os efeitos do cigarro. Callison e Kaestner [13] observaram que aumentos na tributação dos cigarros estavam associados a reduções modestas em seu consumo. Os autores sugeriram que um aumento substancial, de cerca de 100%, seria necessário para reduzir o tabagismo na população adulta em apenas 5%. ...
O objetivo deste estudo foi analisar o cenário de tributos federais no mercado de cigarro brasileiro; a produção e o consumo aparente de cigarros no Brasil; a evolução da arrecadação tributária com cigarros no país; e os mercados lícito e ilícito/contrabando. Como procedimentos metodológicos, com base em dados da Inteligência em Pesquisa, Consultoria Estratégica (IPEC) e do Fórum Nacional Contra a Pirataria e a Ilegalidade (FNCP), foram analisadas as tendências dessas variáveis ao longo do tempo. Como resultado, demonstrou-se que a estratégia de aumentar os preços dos cigarros por meio de tributação e política de preço mínimo contribuiu para a entrada massiva de cigarros contrabandeados no país. A realidade do contrabando de cigarros e suas apreensões não só mostrou isso, como também reforçou que as forças de segurança foram indispensáveis para esse combate, embora não suficientes. Portanto, o contrabando de cigarros poderia ser combatido tanto pelo lado da demanda (reduzindo a procura de cigarros contrabandeados) quanto pelo lado da oferta (prevenindo a entrada de cigarros contrabandeados no mercado).
... However, the effectiveness of specific excise tax has not been fully compromised when implemented through a multi-tier system, thus such a system creates incentives for the production of cheap cigarettes, threatening efforts to reduce consumption [9][10][11][12]. Furthermore, various government efforts undertaken through Minister of Finance Regulation No. 146 of 2017 [13], where simplification of excise tax imposition gradually impacted the introduction of new cigarettes with attributes similar to existing ones conducted by companies to avoid higher taxes [14][15][16][17], resulting in higher price variations and increased consumption of cheap cigarettes [18][19][20]. ...
The manufacturing of new cigarette brands at low prices to exploit lower excise tax tiers poses a challenge to the intended objective of cigarette taxation, which is to reduce consumption for public health protection. This study aims to investigate the impact of a specific multi-tiered excise tax system on the creation of new brands. This study utilizes CK-1 data (application for ordering excise tape) from the Directorate General of Customs and Excise, Ministry of Finance (DJBC), as the authority overseeing cigarette excise taxes in Indonesia. The data consists of nine years of research observations, from 2012 to 2020, totaling 20,379 observations. The period used corresponds to the implementation of the multi-tiered specific cigarette excise tax system. Employing empirical analysis with Poisson regression, the study examines the count data of new brands. Dummy variables for cigarette production types and other relevant factors explaining the simplification policy of cigarette excise tax are included. The empirical analysis reveals a positive association between the implementation of a specific multi-tiered excise tax system and the creation of new cigarette brands. As the number of tiers in the excise tax system increases, so does the incentive for companies to introduce new brands. Furthermore, the analysis indicates that these new brands are typically priced lower, indicating a potential limitation of the specific multi-tiered excise tax system in reducing cigarette consumption. The findings suggest the consideration of a simpler and uniform cigarette excise tax system to address the challenges posed by the proliferation of low-priced new cigarette brands. Policy adjustments are crucial to ensure that excise taxes effectively align with public health objectives while maintaining government revenue. This study underscores the importance of refining taxation policies to mitigate negative health impacts on the public caused by increased cigarette consumption.
... Despite the strong association between teenage and adult smoking, the association between adult taxes and smoking is comparatively weak. In the TUS-CPS, a one-dollar increase in cigarette taxes in year t is associated with a (statistically insignificant) 0.1% point decrease in adult smoking, which translates to an elasticity of −0.01 at the sample mean and is broadly consistent with the elasticities reported by and Callison and Kaestner (2014). In the PSID, a one-dollar increase in cigarette taxes in year t is associated with a (statistically insignificant) 0.8% point decrease in adult smoking, which translates to an elasticity of −0.05 at the sample mean. ...
Are teenage and adult smoking causally related? Recent anti‐tobacco policy is predicated on the assumption that preventing teenagers from smoking will ensure that fewer adults smoke, but direct evidence in support of this assumption is scant. Using data from three nationally representative sources and instrumenting for teenage smoking with cigarette taxes experienced at ages 14–17, we document a strong positive relationship between teenage and adult smoking: deterring 10 teenagers from smoking through raising cigarette taxes roughly translates into 5 fewer adult smokers. We conclude that efforts to reduce teenage smoking can have long‐lasting consequences on smoking participation and, presumably, health.
... Gaining a sound understanding of the effectiveness of these policies in curbing tobacco consumption remains an active area of research. Most studies in this strand of literature have largely been focused on the assessment of the tax effects (Evans et al. 1999;Callison and Kaestner 2014), those of smoke-free laws (Chaloupka and Saffer 1992;McMullen et al. 2005;Song et al. 2015;Larson et al. 2016), or tobaccocontrol expenditures (Farrelly et al. 2003(Farrelly et al. , 2008(Farrelly et al. , 2013, thus examining each of these policies in isolation. This may be problematic in light of certain findings indicating that health behaviors are the outcome of the multidimensional and interactive effects of personal and environmental factors. ...
A sound understanding of the potency of tobacco control policies is key to tobacco prevention. This study exploits a Smoothed Instrumental Variables Quantile Regression estimator to gauge the effectiveness of these policies while addressing major methodological and data limitations plaguing the previous literature. Specifically, smoke-free indoor air laws and tobacco control expenditures are examined in a single framework, which has the promise of accounting for potential complementarities thereof. Further, endogeneity of price (a proxy for tax policy) and other tobacco control policies is addressed through a unique set of instruments while allowing for differential impacts across the conditional distribution of cigarette consumption. Finally, our use of the nationally representative individual-level price and consumption data is essential to precise estimation of price elasticities and policy effects. Results indicate that ignoring price and policy endogeneity leads to inconsistent estimates. Further, tobacco control expenditures appear to be effective only for relatively more addicted smokers. Meanwhile, state-level smoke-free indoor laws, whose primary goal is to reduce exposure to second-hand smoke, do not affect cigarette use among smokers. In contrast, tax policy appears to be most potent for less addicted individuals. Therefore, optimal policy responses should combine tobacco control expenditures with sin taxes.
... Although it is tempting to attribute at least part of the declining trends in cigarette smoking to increases in excise taxes and introduction of more stringent clean indoor air laws, few empirical studies have examined these associations longitudinally and at a national level and these studies mainly focused on youth [7][8][9][10]. Most past research has been based on cross-sectional or time-series analyses [4,[11][12][13][14][15][16][17]. ...
The rates of cigarette smoking in the United States have declined over the past few decades in parallel with increases in cigarette taxes and introduction of more stringent clean indoor air laws. Few longitudinal studies have examined association of taxes and clean indoor air policies with change in smoking nationally. This study examined the association of state and local cigarette taxes and clean indoor laws with change in smoking status of 18,499 adult participants of the longitudinal 2010–2011 Tobacco Use Supplement of the Current Population Survey over a period of 1 year. Every $1 increase in cigarette excise taxes was associated with 36% higher likelihood of stopping smoking among regular smokers. We found no association between clean indoor air laws and smoking cessation nor between taxes and clean indoor air laws with lower risk of smoking initiation. Cigarette taxes appear to be effective anti-smoking policies. Some state and local governments do not take full advantage of this effective policy measure.
... Based on previous studies, geographical context exerts an obvious effect on smoking-related behaviours. At the national scale (between cities), the prevalence of smoking may be affected by various policies related to tobacco taxation (Callison and Kaestner, 2014), the advertising of tobacco products (Hanewinkel et al., 2010), and intervention policies such as "smoking bans" (Catalano and Gilleskie, 2021). At the local level (within cities), area-based housing improvement (Bond et al., 2013), social capital and cohesion (Andrews et al., 2014), neighbourhood crime (Shareck and Ellaway, 2011), and population structure such as age and gender (Grøtvedt and Stavem, 2005) have influenced smoking behaviour evidently. ...
Online search queries have been used in various behaviour studies. As smoking has become a global health issue, studies that assess smoking-related behaviours using online search queries have faced limitations in data utilization and study design. This study conducts comparative analyses to investigate changes in smoking-related behaviours represented by online search volumes. Baidu search queries from 2013 to 2017 were used to examine the search volume containing four groups of smoking-related search keywords. A validation process was used to validate the proposed method by comparing changes in search queries with the observed tobacco consumption. The results show changes in smoking-related behaviours assessed by online search queries at the city level in China. The validation experiments illustrate the consistency between changes in search volumes and tobacco consumption. Thus, online search queries were verified to be an effective instrument for assessing smoking-related behaviours, and this study sheds light on broader behaviour studies and policy assessments.
... Cameron and Williams 2001;Farrelly, Bray, Pechacek, et al. 2001;Gruber, Sen, and Stabile 2003;Zhao and Harris 2004;Tauras 2006;Chung et al. 2007;DeCicca and McLeod 2008;Lovenheim 2008;Aristei and Pieroni 2009;Gospodinov and Irvine 2009;Harding, Leibtag, and Lovenheim 2012;Callison and Kaestner 2014;Maclean, Sikora Kessler, and Kenkel 2016;Nesson 2017a). ...
Tobacco regulation has been a major component of health policy in the developed world since the UK Royal College of Physicians’ and the US Surgeon General’s reports in the 1960s. Such regulation, which has intensified in the past two decades, includes cigarette taxation, place-based smoking bans in areas ranging from bars and restaurants to workplaces, and regulations designed to make tobacco products less desirable. More recently, the availability of alternative products, most notably e-cigarettes, has increased dramatically, and these products are just starting to be regulated. Despite an extensive body of research on tobacco regulations, there remains substantial debate regarding their effectiveness, and ultimately, their impact on economic welfare. We provide the first comprehensive review of the state of research in the economics of tobacco regulation in two decades. (JEL D62, H25, H26, I12, K32, L51, L66)
... Some studies have found that cigarette tax and price increases have significant impacts on reducing smoking prevalence [5,12,16,17]. Others have reported weak or no statistically significant effects of cigarette prices and taxes on cigarette use [18]. The evidence about how the effects of tax and price increases are distributed across subpopulations is also inconsistent. ...
Objective
The conclusions on how tax and price increases affect smoking behaviors are mixed. This work is devoted to re-evaluating the relationship between cigarette prices and taxes and smoking behaviors.
Methods
Using 2000–2019 Behavioral Risk Factor Surveillance System data, we employed linear mixed-effect models to re-examine the impact of cigarette prices and taxes on smoking prevalence and the proportion of current smokers having tried to quit smoking in the past 12 months. All the analyses were conducted for the general population, then by age group, gender, race/ethnicity, and income level.
Results
The results indicate that higher cigarette prices and taxes were associated with a decrease in smoking prevalence and an increased likelihood of quitting smoking. Cigarette tax and price increases produced the most powerful impact on the smoking prevalence of 18- to 24-year-olds. The estimates also show that males tended to be more price-sensitive than females. Raising cigarette prices and taxes was estimated to be more effective in reducing the smoking prevalence among non-Hispanic Blacks and Hispanics when compared to non-Hispanic whites. Cigarette price and tax changes were likely to have a smaller effect on individuals with annual income under $25,000 relative to individuals with higher income levels.
Conclusions
Increases in cigarette prices and taxes are significantly associated with a reduction in smoking prevalence and an increased likelihood of quitting smoking among adults across different demographic and socioeconomic groups. However, as cigarette price and tax changes disproportionately affect low-income individuals, raising cigarette prices and taxes may deepen income disparities.
... During the same internal review, it was also decided to add new outcome variables in the primary and sensitivity analyses: (i) average population cigarette consumption (primary analysis), (ii) average population FM and RYO cigarette consumption per day (sensitivity analysis) and (iii) average cost per FM and RYO cigarette (primary analysis). These variables may be more sensitive to FM/RYO-specific tax increases and have been used widely in previous literature [6,14,16,17]. ...
Aims:
This study aimed to evaluate the impact of announcement of tax increases on factory-made (FM) and roll-your own (RYO) cigarettes in England.
Design:
Autoregressive Integrated Moving Average with Exogeneous Input (ARIMAX) time series modelling SETTING: England PARTICIPANTS: Data were aggregated monthly on 274,890 participants between 2007 and 2019 taking part in the Smoking Toolkit Study (STS).
Measurements:
The association of sustained step level changes for tax rises for FM cigarettes and temporary pulse effects for tax rises for RYO cigarettes with smoking, quit attempt and quit success prevalence as well as per capita self-reported cigarette consumption and cost per cigarette was assessed.
Findings:
A 10% rise in tax on RYO cigarettes was associated with a temporary 21.1% decline (95% confidence interval [CI] -30.4 to -10.7) in smoking prevalence, and 20.7% decline (95%CI-32.4 to -7.0) in per capita self-reported cigarette consumption; while a 3% rise of tax on RYO cigarettes was associated with a temporary 20.7% decline (95%CI -33.3 to -5.8) in the amount paid per RYO cigarette. For tax increases on FM cigarettes, a 5% above-inflation tax rise was associated with a step-level increase of 33.1 % (95%CI 18.4 to 49.5) in quit success rates. However, some of the findings were sensitive to model specification and temporally specific.
Conclusion:
The announcements of tax increases for cigarettes in England between 2010 and 2018 were inconsistently associated with temporary reductions in smoking prevalence, per capita self-reported cigarette consumption and improved quit success. Paradoxically, reductions in the cost for roll-your-own cigarettes were also found. The results were not robust in all sensitivity analyses.
... Of course, it is also possible that individuals (girls in this case) have a relatively price inelastic demand. The null finding for an SSB tax is consistent with recent research finding that consumers had very little response to the large increases in cigarette taxes (Callison & Kaestner, 2014). That study estimated that price elasticities for cigarettes are so low that one would have to double the tax to reduce smoking by 5%. ...
Taxes on sugar‐sweetened beverages (SSBs) are relatively new and there is limited evidence about their impact on SSB consumption or body mass index (BMI) (as opposed to prices, purchases, or sales), their impact on youth (as opposed to adults), or their impact in non‐Western nations. This paper adds to the evidence across all these dimensions by estimating the effect of an SSB tax on SSB consumption and the BMI of youth in Mauritius, an island nation in the Indian Ocean, which we compare to Maldives, another island nation which did not implement an SSB tax during the time of our data. Results of difference‐in‐differences models indicate that the tax in Mauritius had no detectable impact on the consumption of SSBs or the BMI of the pooled sample of boys and girls. However, models estimated separately by sex indicate that the probability that boys consumed SSBs fell by 9.4 percentage points (11%). These are among the first estimates of the effect of SSB taxes on youth consumption and contribute to the limited evidence on the impact of SSB taxes on weight, and in non‐Western countries.
... In Australia and New Zealand, reduction in smoking prevalence has stalled over the last decade. This is despite provision of free counselling, heavily subsidized (often free) cessation medications, mass media campaigns, dramatic increases in tobacco taxes (more than in all other countries), and extensive environmental bans on smoking (Callison & Kaestner, 2014;Gallet & List, 2003). The tobacco tax increases have increased demand for cheaper cigarettes on the black market. ...
Robberies of New Zealand convenience stores for tobacco products spiked between 2016 and 2017. According to media reports, many robberies involved the use of weapons and resulted in injury to retailers. We conducted a content analysis of all online media articles containing commentary about these robberies, published between 2014 and 2019, to identify the perceived causes of the increase in robberies for tobacco and remedies implemented or demanded. The commentators in the articles were categorized into three groups of stakeholders: elites, grassroots, and interest groups. Overall, there was a mismatch between perceiving the primary cause to be socially and economically determined and suggesting solutions that were mostly situational shop level changes or tertiary prevention strategies, such as more and harsher policing. A further mismatch was that existing policing policy was not adapted to balance the perverse consequences of the tobacco excise tax increases. Early commentators tended to deflect blame away from their own sector. Later commentary converged to agree that the high tobacco excise tax was a critical causal factor.
... Tobacco taxes have also been questioned as to their effectiveness in reducing adult smoking as evidence that tobacco taxes reduce adult smoking is relatively sparse (Wamamili and Garrow, 2017). Anti-smoking attitudes are said to be more effective in reducing smoking, particularly among younger people (Callison and Kaestner, 2012). ...
Purpose
A large increase in robberies of convenience stores in New Zealand (NZ) in 2016 and 2017 was anecdotally attributed to persistent and substantial increases in excise tax on tobacco products. This study aims to explore the validity of that claim by examining the characteristics of the robberies through the lens of online news coverage.
Design/methodology/approach
Google, Bing and main online NZ news outlets were searched for news reports between 2009 and 2018 of tobacco-related store robberies. Content analysis was used to extract characteristics such as date of robbery, type of store, items targeted or stolen and demographic profile of offenders. The prevalence of reported robberies by socioeconomic level of the surrounding community was assessed using nearest primary school decile rating. Descriptive statistics and statistical analysis were used to discuss trends and key findings in the data.
Findings
Reports on 572 robberies were unevenly distributed across the years with a large increase in 2016 and 2017, followed by a substantial decrease in 2018. Local community convenience stores were primarily hit – more so in lower socioeconomic communities. Robberies occurred nationwide and disproportionately so during colder months in lower socioeconomic communities. Many robberies were aggravated resulting in serious injury to shopkeepers. Tobacco and cash were predominantly targeted.
Social implications
The large increase in robberies that occurred in 2016–2017 likely resulted from tax-driven tobacco price hikes combined with reduced duty-free tobacco coming into NZ with travellers. Installation of security in stores, news fatigue and other explanations are potential reasons for the 2018 decrease in reported robberies despite tobacco prices increasing. Frequent robberies of local stores, many including violence, should be a public health concern as destruction of community well-being can be a determinant of other health problems. The negative consequences for communities, particularly lower socioeconomic communities, need to be factored into the cost benefit analysis of raising the tax on tobacco.
Originality/value
This study provides much needed detail on the negative health and social consequences of tobacco-related store robberies.
... In fact, "a meta-analysis of tobacco price elasticity suggests that a price rise of 10% would lead to around 4% reduction in smoking in highincome countries (Gallet & List, 2003in Whitehead et al., 2018. Tobacco taxes work by increasing the price of tobacco products which stimulates cessation, reduces consumption, and prevents people from taking up smoking (Bader et al., 2011;Callison & Kaestner, 2014;Lynch & Bonnie, 1994;Sharbaugh et al., 2018;Tabuchi et al., 2017). The Framework Convention on Tobacco Control (FCTC) (Article 6) requires members to implement tax policies in order to reduce tobacco. ...
Since 2010, several nations with impressive histories of smoking cessation have witnessed the proliferation of Alternative Nicotine Delivery Systems (ANDS). Advocates suggest that ANDS offer an effective and safer substitute for combustible tobacco. Critics fear that ANDS could expose consumers to novel harms, discourage smoking cessation and may even renormalize tobacco use. Different nations have adopted radically different regulatory strategies ranging from outright bans to active encouragement of ANDS-led smoking cessation. Economic, social and political factors also influence rates of smoking and uptake of ANDS. An investigation into the national-specific context for smoking cessation; including the role of ANDS in reducing cigarette consumption, is likely of value to regulators around the world hoping to reduce smoking-related morbidity and mortality in their own communities.
Five case studies were conducted to review the evidence from Australia, Canada, Japan, South Korea and the UK, drawing on an interdisciplinary framework for investigation combining sociological, ethnographic, policy analytic and econometric disciplinary approaches into a schema for studying the drivers of smoking cessation at the individual, micro, meso and macro levels. Data on smoking, and cessation from four decades was combined with more recent data on ANDS use, to investigate the relationship between tobacco control policies, ANDS use and smoking cessation, as well as other salient aspects of the national tobacco control landscape. Each case study developed specific recommendations for policy makers and the research agenda. This report summarizes the findings of those studies.
Taxation and Stop Smoking Services (SSS) were among the most effective cessation drivers. Smoke-free laws were also found to be of value, though the evidence for their efficacy in reducing smoking prevalence is mixed. Other policies that sought to reduce the appeal or opportunity to smoke such as plain pack legislation and health warnings, etc. were less associated with short term reductions in smoking prevalence, though these may yet reduce national smoking rates by discouraging uptake among future generations. Tobacco use continues to be concentrated in socially and economically disadvantaged groups. Where regulations allowed, ANDS (e-cigarettes and heated tobacco in particular) were associated with smoking cessation. Moreover, instances of tobacco use declining even as e-cigarette use increased suggests that e-cigarettes do not necessarily re-normalize tobacco use as feared. The results demonstrate how policy decisions affect ANDS use and the latter’s value as a cessation mechanism.
The authors recommend that regulators continue to increase tobacco taxes carefully and study how to integrate ANDS with well-funded SSS provision. Regulators should also seek policies that differentiate among nicotine products with respect to their harms profiles. Future cessation programs should target socially and economically disadvantaged groups where tobacco harms continue to be concentrated. This research highlights the need for high quality open-access data collection and analysis, especially regarding use of ANDS.
... The process started with calculating the propensity score, which was the predicted probability of achieving a threshold of BEPS Action Plan 13 (sales figure of 1 trillion KRW) as a function of covariates. I used logistic regression when calculating the propensity score following prior studies (e.g., [41,42]), as it was a binary outcome for MNEs as they become either treated or control MNEs. For example, Graham and Tucker [43] run logistic regression to estimate tax sheltering likelihood in order to match the tax shelter firm with non-tax shelter firms. ...
As tax is related to the sustainable growth of societies around the world, international tax avoidance by multinational enterprises (MNEs) has gained public attention. The Organization for Economic Co-operation and Development (OECD) introduced the Base Erosion and Profit Shifting (BEPS) Action Plan to promote sustainable tax behavior of MNEs. To guide policymakers and regulators in curving MNEs’ tax schemes utilizing market imperfection, this paper empirically assesses whether the international law reform regarding information disclosures on global operation achieves the intended result of lowering MNEs’ tax avoidance. In addition, the conditional effect of family ownership and intangible asset intensity is addressed to find the factors that strengthen the tax avoidance level of MNEs. This study employs propensity score matching and difference-in-differences method to analyze the changes in international tax liabilities of Korean MNEs in response to BEPS Action Plan 13. The empirical results show that the sustainable tax behavior of MNEs increased when international tax law demanded that they reveal critical information on global allocation of income, economic activity, and taxes paid among countries. Furthermore, the results show that there was a higher increase in the international tax liabilities of MNEs with higher intangible asset intensity. The results suggest to policymakers that the private information disclosure of MNEs’ global operation and sharing such information is essential in tackling MNEs’ BEPS activities, and intangible assets are indeed an important source of tax avoidance.
... The results of the current study also revealed that the current prices of cigarettes, though high, do not affect the consumption levels of people; however, higher prices would motivate people to quit smoking, thereby revealing that tobacco taxation has a positive impact on the smoking behavior of the people. This result aligns with a study conducted by Callison & Kaestner, 16 which found that increases in cigarette taxes lead to small decreases in cigarette consumption; however, sizeable tax increases, on the order of 100%, will reduce smoking by 5%. The results of the current study are also in line with those of a survey conducted by Campaign for Tobacco Free Kids, 17 which found that raising tobacco taxes generates revenue and discourages people from smoking. ...
Objectives:
The current research aims to study the impact of raising tobacco tax and implementation of plain packaging on male smokers' quitting intentions in Saudi Arabia.
Methods:
The study adopts a quantitative approach where close-ended questionnaires are distributed among 1,015 male participants from different regions of Riyadh city, Saudi Arabia. Bivariate analysis and logistic regression analysis are conducted using SPSS software to analyze the collected primary data.
Results:
The study found a significant association of taxation and plain packaging on the quitting intentions of smokers. On taxation, while a considerable number of participants (46.5%) stated that they would not quit smoking if the cigarette prices increased, participants who were planning to give up smoking said it would strengthen their intention (p less than 0.001). In addition, logistic regression was performed to identify the independent predictors of quitting intention. Participants who did not want to apply the concept of plain packaging to Saudi Arabia were more likely to have quitting intention (odds ratio: 2.30 [1.61-3.28]) in comparison to those who wanted to apply the concept.
Conclusion:
Although the current price of cigarette packs reported to be very high by the participants, imposing a new higher tax may motivate smokers who had plans to quit in the near future. Plain packaging seems to be an effective new strategy in addition to tobacco taxation in Saudi Arabia, yet, more time and further research are required to assess the effectiveness of the strategy.
... This method has been extensively used in relevant previous literature to evaluate the wide-scale effects of tobacco measures (for example, see refs. 29,30 ). ...
The removal of all branding and promotions from tobacco products, known as ‘plain packaging’, is intended to decrease tobacco consumption. Here we examine the effectiveness of Australia’s plain packaging law, which coincided with a change in graphic and text health warnings, by using nationally indicative data 5 years post implementation. We measured the effect of the law on smoking prevalence, tobacco expenditure, expenditure intensity and quantity of tobacco consumed, using New Zealand as a control country in a difference-in-differences research design. We uncover a substitution effect that is robust to different specifications and control countries. In response to the policy, smokers switched from more expensive to cheaper cigarettes and reduced their overall tobacco expenditure and expenditure intensity. However, as smoking became less costly, smokers consumed more cigarettes. To discourage such substitution and to help the policy achieve its intended outcomes, policymakers should consider implementing auxiliary measures, such as taxes or price floors.
... Other modeling studies reporting on the influence of taxation changes on detrimental health habits similarly found that sizable increases in tobacco taxes were required to have significant clinical effect. A 100% increase in tobacco tax was required to decrease adult smoking by about 5% (Kevin and Robert, 2012), which was similar to our finding that a 100% increase in spirits excise tax was required to decrease transplant listing for ALD by ≥6.3%. Further supportive of these results, increased cigarette tax in California in 2017, which increased the price for a pack of cigarettes from an average of $6 to $9, resulted in decreased cigarette sales by 23% (Levin, 2017). ...
Background
Alcohol‐related liver disease (ALD) is a leading indication for liver transplantation.
Methods
State consumption of spirits, wine, and beer was determined from published sources. Excise and ad valorem alcohol taxes of spirits, wine, and beer were calculated following standard practices and correlated using multiple logistic regression models to 2002 to 2015 ALD transplant listing data from the United Network for Organ Sharing database.
Results
21.22% (29,161/137,440) of transplant listings were for ALD. Increased consumption of spirits was associated with increased ALD transplant listings (odds ratio [OR]: 1.67; 95% CI: 1.12 to 2.49, p = 0.01), but wine and beer consumption did not have a statistically significant association with ALD transplant listings. Spirits excise taxes on‐ and off‐premise were inversely associated with ALD transplant listing (OR: 0.79 and 0.82, respectively, both p < 0.02). Beer and wine taxes were not significantly associated with ALD transplant listings.
Conclusions
Transplant listings for ALD are directly associated with spirit consumption and inversely associated with spirits excise taxes. These findings suggest a possible public health benefit of increasing excise taxes for spirits.
This preregistered systematic review and meta-analysis (PROSPERO: CRD 42022311392) aimed to synthesize the effectiveness of all available population-level tobacco policies on smoking behaviour. Our search across 5 databases and leading organizational websites resulted in 9,925 records, with 476 studies meeting our inclusion criteria. In our narrative summary and both pairwise and network meta-analyses, we identified anti-smoking campaigns, health warnings and tax increases as the most effective tobacco policies for promoting smoking cessation. Flavour bans and free/discounted nicotine replacement therapy also showed statistically significant positive effects on quit rates. The network meta-analysis results further indicated that smoking bans, anti-tobacco campaigns and tax increases effectively reduced smoking prevalence. In addition, flavour bans significantly reduced e-cigarette consumption. Both the narrative summary and the meta-analyses revealed that smoking bans, tax increases and anti-tobacco campaigns were associated with reductions in tobacco consumption and sales. On the basis of the available evidence, anti-tobacco campaigns, smoking bans, health warnings and tax increases are probably the most effective policies for curbing smoking behaviour. Tobacco use remains a persistent global health challenge. Despite numerous control policies implemented at both global and national levels over the years 1 , tobacco use continues to be a major cause of premature death. In 2019 alone, there were a staggering 8.7 million deaths worldwide directly attributable to tobacco consumption 2. Tobacco exposure, through active or passive smoking, presents serious risks for non-communicable diseases, particularly cardiovascular diseases, cancers , chronic respiratory diseases and diabetes 3 , which account for nearly three-quarters of annual deaths globally 1. Various control approaches have been proposed and implemented to deter the demand for smoking and improve health, including taxation, mass media campaigns, health warnings on packaging, marketing restrictions and smoke-free laws 4-6. To date, evidence on behavioural outcomes such as smoking prevalence, initiation and cessation in response to tobacco control policies has been mixed 4,7,8. In 2008, the World Health Organization, in line with the Framework Convention on Tobacco Control, introduced the MPOWER policy package-a set of six measures designed to guide countries in rolling out cost-effective interventions aimed at reducing tobacco demand across populations 9. As shown in previous studies 10,11 , countries that have implemented high levels of MPOWER measures, particularly those pertaining to "monitoring the use of tobacco products" and "raising taxes on tobacco products" 10 , have effectively reduced smoking prevalence among adults. However, in many countries implementing lower levels of MPOWER, it remains
This preregistered systematic review and meta-analysis (PROSPERO: CRD 42022311392) aimed to synthesize the effectiveness of all available population-level tobacco policies on smoking behaviour. Our search across 5 databases and leading organizational websites resulted in 9,925 records, with 476 studies meeting our inclusion criteria. In our narrative summary and both pairwise and network meta-analyses, we identified anti-smoking campaigns, health warnings and tax increases as the most effective tobacco policies for promoting smoking cessation. Flavour bans and free/discounted nicotine replacement therapy also showed statistically significant positive effects on quit rates. The network meta-analysis results further indicated that smoking bans, anti-tobacco campaigns and tax increases effectively reduced smoking prevalence. In addition, flavour bans significantly reduced e-cigarette consumption. Both the narrative summary and the meta-analyses revealed that smoking bans, tax increases and anti-tobacco campaigns were associated with reductions in tobacco consumption and sales. On the basis of the available evidence, anti-tobacco campaigns, smoking bans, health warnings and tax increases are probably the most effective policies for curbing smoking behaviour.
Objective — to systematize scientific knowledge on the effect of living conditions in large national regions on tobacco consumption at the individual level. Material and Methods — The goals and methodology of the systematic review were previously specified and recorded in the protocol PROSPERO CRD42021234874. We conducted a search for publications on the topic of our study in PubMed, Google Scholar, OpenGrey, CrossRef and eLibrary databases through December 31, 2021. Article search, selection and analysis were carried out by two trained researchers, with the participation of a third researcher whenever necessary. After removing duplicates, ineligible articles, and full-text screening, 204 publications were included in this review from the initial pool of 9,717 publications. Results — Published articles on the topic under consideration varied significantly in terms of the sample size, study design, regional characteristics, and considered outcomes (smoking). The most convincing were the dependences of individual tobacco consumption on the legislative characteristics and tobacco environment in the regions. Regional characteristics unrelated to tobacco use were not often analyzed in reviewed studies. As shown in our review, to date, they did not confirm any impact whatsoever. Conclusion — We examined the features of research on the topic under consideration and highlighted the best evidence-based predictors of the regional environment in relation to smoking. We also identified poorly studied areas of research requiring further attention.
INTRODUCTION: Electronic cigarettes (e-cigarettes) are an alternative to traditional cigarettes. Although numerous studies have been conducted regarding the effects of traditional cigarettes on oxidative stress biomarkers in the kidney, there are only a few studies on the effects of e-cigarettes. METHODS: A total of 24 male Wistar albino rats were separated into three groups: Group 1 was treated with traditional cigarettes, Group 2 with e cigarettes, and Group 3 formed the control group. Kidney homogenates and plasma samples were obtained, and the glutathione peroxidase, protein carbonyl, superoxide dismutase (SOD), catalase (CAT), lipid hydroperoxide (LPO), and symmetric dimethylarginine (SDMA) levels were examined. RESULTS: Higher plasma SDMA levels were determined in Group 1 and Group 2 compared with Group 3 (<0.0001). Higher SOD activity was found in Group 1 compared with Group 2 (p=0.0094). Lower CAT activity was found in Group 1 compared with both Group 2 (p=0.0035) and Group 3 (p<0.0001). Higher LPO levels were determined in the traditional cigarette smoking group compared with the control group (p=0.028), and no statistically significant difference was found between the e-cigarette and the control groups. DISCUSSION AND CONCLUSION: E-cigarettes and traditional cigarettes are associated with the dysregulation of particular oxidative stress markers in the kidney. However, e-cigarettes have less effect on some oxidative stress markers than traditional cigarettes. Long-term use of traditional cigarettes and e cigarettes causes oxidative stress, which may lead to renal tissue damage and diminished kidney function.
Recent findings from psychology and behavioral economics suggest that we are “predictably irrational” in the pursuit of our interests. Paternalists from both the social sciences and philosophy use these findings to defend interfering with people's consumption choices for their own good. We should tax soda, ban cigarettes, and mandate retirement savings to make people healthier and wealthier than they’d be on their own. Our thesis is that the standard arguments offered in support of restricting people’s consumption choices for their own good also imply support for “epistocratic” restrictions on people’s voting choices for their own good. Indeed, the philosophical case for paternalistic restrictions on voting choices may be stronger than the case for restricting personal consumption choices. So, paternalists face a dilemma: either endorse less interference with consumption choices or more interference with voting choices.
Objective The conclusions on how tax and price increases affect smoking behaviors are mixed. This work is devoted to re-evaluating the relationship between cigarette prices and taxes and smoking behaviors.
Methods Using 2000-2019 Behavioral Risk Factor Surveillance System data, we employed linear mixed-effect models to re-examine the impact of cigarette prices and taxes on smoking prevalence and the proportion of current smokers having tried to quit smoking in the past 12 months. All the analyses were conducted for the general population, then by age group, gender, race/ethnicity, and income level.
Results The results indicate that higher cigarette prices and taxes were associated with a decrease in smoking prevalence and an increased likelihood of quitting smoking. Cigarette tax and price increases produced the most powerful impact on the smoking prevalence of 18- to 24-year-olds. The estimates also show that males tended to be more price-sensitive than females. Raising cigarette prices and taxes was estimated to be more effective in reducing the smoking prevalence among non-Hispanic Blacks and Hispanics as compared to non-Hispanic whites. Cigarette price and tax changes were likely to have a smaller effect on individuals with annual income under $25 000 relative to individuals with higher income levels.
Conclusions Increases in cigarette prices and taxes are significantly associated with a reduction in smoking prevalence and an increased likelihood of quitting smoking among adults across different demographic and socioeconomic groups. However, as cigarette price and tax changes disproportionately affect low-income individuals, raising cigarette prices and taxes may deepen income disparities.
We provide the first quasi-experimental evidence on the relationship between cigarette taxes and smoking among sexual minority adults, a group that has been understudied in past research. We use large samples of individuals in same-sex households (a large share of whom are sexual minorities in same-sex romantic relationships) from the 1996-2018 Behavioral Risk Factor Surveillance System. We find that cigarette taxes significantly reduced smoking among men and women in same-sex households, and the effects we find for men in same-sex households are very robust and significantly larger than the associated effects for men in different-sex households (the vast majority of whom are heterosexual married or partnered men). For men in same-sex households, we find no unintended consequences of higher cigarette taxes on other risky behaviors, and in fact we find that cigarette taxes are associated with significant improvements in self-rated health for men in same-sex households. These results suggest that the sizable disparities in adult smoking rates between heterosexual and sexual minority men would have been even larger in the absence of stricter tobacco control policy. However, in line with previous research indicating that cigarette taxes have ‘lost their bite’, we find no significant relationship between cigarette taxes and sexual minority smoking in more recent years.
Cigarette smokers earn significantly less than nonsmokers, but the magnitude of the smoking wage gap and the pathways by which it originates are unclear. Proposed mechanisms often focus on spot differences in employee productivity or employer preferences, neglecting the dynamic nature of human capital development and addiction. In this paper, we formulate a dynamic model of young workers as they transition from schooling to the labor market, a period in which the lifetime trajectory of wages is being developed. We estimate the model with data from the National Longitudinal Survey of Youth, 1997 Cohort, and we simulate the model under counterfactual scenarios that isolate the contemporaneous effects of smoking from dynamic differences in human capital accumulation and occupational selection. Results from our preferred model, which accounts for unobserved heterogeneity in the joint determination of smoking, human capital, labor supply, and wages, suggest that continued heavy smoking in young adulthood results in a wage penalty at age 30 of 15.9% and 15.2% for women and men, respectively. These differences are much smaller than the raw difference in means in wages at age 30. We show that the contemporaneous effect of heavy smoking net of any life-cycle effects explains 62.9% of the female smoking wage gap but only 20.4% of the male smoking wage gap.
The article analyses the ways to improve tobacco excise taxation in Ukraine considering a respective EU Member States experience, consequences of national reforms held in previous years, as well as challenges and potential threats caused by the pandemic. A worsening economic situation and the recent decline in income compounded the existing problems related to tobacco taxation in Ukraine. The increase of excise tax rate on cigarettes by 20% annually till 2025 and an inconsistent decision on more than four times increase of excise tax rates on electronically heated tobacco products (EHTP) pose a risk of boosting illicit trade. The advance payment of excise tax on imported tobacco products, in turn, negatively affects finances of importers due to the working capital diversion. Following that, the priority steps with regard to the excise policy of Ukraine should be aimed at: 1) revision of the existing plan of increasing tax rates on cigarettes by slowing down the growth of tax burden and simultaneous expansion of the plan till 2028; 2) correcting the burdensome reform on excise taxation of EHTP to establish more liberalized tax regime 3) switching to payment of excise tax on imported tobacco products during customs clearance. The mentioned initiatives taking into account a strong need to improve a fiscal situation in Ukraine due to the spread of COVID-19 will reduce a negative impact of increasing excise tax rates and administration procedures on tobacco industry. They will also prevent the growth of illicit trade in tobacco products and thus will contribute to improving the efficiency of tax system and strengthening the confidence of business entities.
Introduction
. Cigarette excise taxes are a well-established policy lever for reducing tobacco use. However, estimating the effect of taxes on smoking behavior can be confounded by endogeneity concerns such as selection. This study leverages a unique natural experiment –compulsory relocation of U.S. military service members to installations – to estimate the relationship between state cigarette taxes and smoking behavior without concerns about selection into environments.
Methods
. The current study uses data from the Department of Defense’s 2011 Health-Related Behaviors Survey and 2011 state cigarette excise taxes from the CDC STATE System. Logistic and Poisson regression analyses estimate the cross-sectional associations between state cigarette excise taxes and the following smoking behaviors: current cigarette smoking, frequency of smoking, heaviness of consumption, and cigarette cessation among individuals who smoked while at the current installation.
Results
. Higher taxes are associated with lower odds of current cigarette smoking (AOR = 0.94; 95% CI: 0.89 - 0.98), fewer smoking days per month among current cigarette smokers (IRR = 0.98, 95% CI 0.97 - 0.996), and higher likelihood of quitting smoking among individuals who had smoked at their current installation (AOR = 1.14, 95% CI 1.05 - 1.25). Taxes are not associated with the number of cigarettes smoked per day among current smokers.
Conclusions
. Exogenous assignment to installations in states with higher cigarette taxes is associated with lower likelihood of smoking and greater likelihood of quitting. Findings provide novel evidence in support of a causal impact of cigarette taxes on lower smoking levels among adults.
The milk addiction paradox refers to an empirical finding in which consumption of non-addictive commodities such as milk appears to be consistent with the theory of rational addiction. This paradoxical result seems more likely when consumption is persistent and with aggregate data. Using both simulated and real data, we show that the milk addiction paradox disappears when estimating the data using an AR(1) linear specification that describes the saddle-path solution of the rational addiction model, instead of the canonical AR(2) model. The AR(1) specification is able to correctly discriminate between rational addiction and simple persistence in the data, to test for the main features of rational addiction, and to produce unbiased estimates of the short and long-run elasticity of demand. These results hold both with individual and aggregated data, and they imply that the AR(1) model is a better empirical alternative for testing rational addiction than the canonical AR(2) model.
In 1956, 52% of urban men and 42% of rural men smoked cigarettes. By 2010, the disparity had flipped: 24.7% of urban men and 30.6% of rural men smoked. Smoking remains the greatest preventable cause of mortality in the United States, and understanding the underlying causes of place-specific differences in behavior is crucial for policy aimed at reducing regional inequality. Using geocoded data from the National Longitudinal Survey of Youth 1979 Cohort, I estimate a dynamic model that captures smoking behavior, location decisions, and education over thirty years. Simulation of the estimated model demonstrates that selection on permanent unobserved variables that are correlated with smoking cessation, both in native populations and in those who migrate between rural and urban areas, explains 70.9% of the urban/rural smoking disparity. Alternatively, differential tobacco control policies explain only 9.6% of the urban/rural smoking disparity, which suggests that equalizing cigarette taxes across regions may fail to bridge gaps in behavior and health. This paper emphasizes that rural smoking disparities are largely driven by who selects into rural communities.
Smoking—and increasingly, vaping—is accused of imposing unnecessary healthcare costs on society that justify a tobacco tax. But tobacco’s societal impact is more complicated than what the conventional wisdom dictates. Many of the health risks from tobacco use are overstated. While they have undeniably shorter life expectancies, tobacco users save governments money—a lot of it. Research is also clear that tobacco taxes have little to no effect on smoking. But thanks to experts and interest groups, tobacco taxes aren’t likely going away. Too many government programs cannot afford fewer smokers, nor can experts and special interest groups funded with grants from tobacco tax revenue.
While the tobacco industry ranks among the most substantial and successful of economic enterprises, tobacco consumption is associated with more deaths than any other product. Economic analysis of the markets for tobacco products, particularly cigarettes, has contributed considerable insight to debates about the importance of the industry and the appropriate roles of public policy in grappling with the health consequences of tobacco. Certainly the most significant example of this phenomenon has been the rapidly expanding and increasingly sophisticated body of research on the effects of price increases on cigarette consumption. Because excise tax comprises an important component of price, the resultant literature has played a prominent role in legislative debates about using taxation as a principal tool to discourage smoking. In addition to informing legislative debates, this literature has contributed both theory and empirical evidence to the growing interest in modeling the demand for addictive products.This chapter examines this body of research in detail, as well as a variety of equity and efficiency concerns accompanying debates about cigarette taxation. Coverage also includes economic analysis of the role of other tobacco control policies, such as restrictions on advertising, of special interest due to their prominence in debates about tobacco control. The chapter concludes with consideration of research addressing the validity of the tobacco industry's argument that its contributions to employment, tax revenues, and trade balances are vital to the economic health of states and nations. This argument is one of the industry's principal weapons in its battle against policy measures intended to reduce tobacco product consumption.
This paper uses micro-data on cigarette consumption from four waves of the CPS Tobacco Supplement to estimate cigarette demand models that incorporate the decision of whether to smuggle cigarettes across a state or Native American Reservation border. I find demand elasticities with respect to the home state price are indistinguishable from zero on average and vary significantly with the distance individuals live to a lower-price border. However, when smuggling incentives are eradicated, the price elasticity is negative, though still inelastic. I also estimate cross-border sales cause a modest increase in consumption, and between 13 and 25 percent of consumers purchase cigarettes in border localities in the CPS sample. The central implication of this study is, while cigarette taxes are ineffective at achieving the goals for which they were levied in many states, there are significant potential gains from price increases that are confounded by cross-border sales.
Building on an idea in Abadie and Gardeazabal (2003), this article investigates the application of synthetic control methods to comparative case studies. We discuss the advantages of these methods and apply them to study the effects of Proposition 99, a large-scale tobacco control program that California implemented in 1988. We demonstrate that following Proposition 99 tobacco consumption fell markedly in California relative to a comparable synthetic control region. We estimate that by the year 2000 annual per-capita cigarette sales in California were about 26 packs lower than what they would have been in the absence of Proposition 99. Given that many policy interventions and events of interest in social sciences take place at an aggregate level (countries, regions, cities, etc.) and affect a small number of aggregate units, the potential applicability of synthetic control methods to comparative case studies is very large, especially in situations where traditional regression methods are not appropriate. The methods proposed in this article produce informative inference regardless of the number of available comparison units, the number of available time periods, and whether the data are individual (micro) or aggregate (macro). Software to compute the estimators proposed in this article is available at the authors' web-pages.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
In this paper we contribute new empirical results about consumers’ decisions to avoid cigarette excise taxes, and a new applied welfare economic analysis of optimal excise taxation with tax avoidance. We examine direct measures of consumer excise tax avoidance in novel individual-level data from the 2003 and 2006 - 2007 Tobacco Use Supplements to the U.S. Current Population Survey. We estimate reduced-form models and a structural endogenous switching regression model. In the structural border-crossing equation, the decision to cross the border depends on the difference between the endogenous home- and border-state prices. The reduced-form and structural results show that the probability of cross-border cigarette purchases responds in predictable ways to the economic incentives created by the distance to the border and state tax differentials. To our knowledge, we are also the first study to extend the formula for optimal Pigouvian corrective taxation to incorporate excise tax avoidance. Taking into account tax avoidance implies the optimal tax is substantially below the simple Pigouvian tax that internalizes external costs. In illustrative calculations for 2003, we find that in 20 states the optimal tax that accounts for tax avoidance is at least 20 percent smaller than the simple Pigouvian tax.
We conduct an empirical study of the impact of consumer price-search on the shifting of cigarette excise taxes to consumer prices. We use novel data on the prices smokers report actually paying for cigarettes. We document substantial price dispersion. We find that cigarette taxes are shifted at lower rates to the prices paid by consumers who undertake more price search – carton buyers, and especially, smokers who buy cartons of cigarettes in a state other than their state of residence. We also find suggestive evidence that taxes are shifted at slightly higher rates to the prices paid by non-daily smokers, less addicted smokers, and smokers of light cigarettes.
To examine cigarette purchasing patterns of current smokers and to determine the effects of cigarette price on use of cheaper sources, discount/generic cigarettes, and coupons.
Higher cigarette prices result in decreased cigarette consumption, but price sensitive smokers may seek lower priced or tax-free cigarette sources, especially if they are readily available. This price avoidance behaviour costs states excise tax money and dampens the health impact of higher cigarette prices.
Telephone survey data from 3602 US smokers who were originally in the COMMIT (community intervention trial for smoking cessation) study were analysed to assess cigarette purchase patterns, use of discount/generic cigarettes, and use of coupons.
59% reported engaging in a high price avoidance strategy, including 34% who regularly purchase from a low or untaxed venue, 28% who smoke a discount/generic cigarette brand, and 18% who report using cigarette coupons more frequently that they did five years ago. The report of engaging in a price avoidance strategy was associated with living within 40 miles of a state or Indian reservation with lower cigarette excise taxes, higher average cigarette consumption, white, non-Hispanic race/ethnicity, and female sex.
Data from this study indicate that most smokers are price sensitive and seek out measures to purchase less expensive cigarettes, which may decrease future cessation efforts.
Cigarette excise taxes are widely viewed by health economists as an effective tool to reduce cigarette consumption. However, those opposed to increasing cigarette excise taxes often state that the taxes unfairly target certain segments of the population, notably the poor and minorities. Some of this opposition may have been fueled by a lack of understanding of how the tax will affect the health and welfare of various demographic groups of interest. This article provides guidance to policy makers by estimating price elasticities among adults by gender, income, age, and race or ethnicity. Women, adults with income at or below the median income, young adults, African‐Americans, and Hispanics are most responsive to cigarette price increases. For example, adults with income at or below the median are more than four times as price‐responsive as those with income above the median.
Using a statistical matching procedure to choose control groups, we find that four states that adopted large cigarette tax hikes had corresponding decreases in smoking participation of pregnant women. Using the tax hike as an instrument for smoking in birth-weight equations and pooling data across experiments, we find that smoking during pregnancy doubles the chance an infant is born with a low birth weight. Our estimates are similar to singleequation estimates where maternal smoking is treated as exogenous.
Cigarette excise taxes are widely viewed by health economists as an effective tool to reduce cigarette consumption. However, those opposed to increasing cigarette excise taxes often state that the taxes unfairly target certain segments of the population, notably the poor and minorities. Some of this opposition may have been fueled by a lack of understanding of how the tax will affect the health and welfare of various demographic groups of interest. This article provides guidance to policy makers by estimating price elasticities among adults by gender, income, age, and race or ethnicity. Women, adults with income at or below the median income, young adults, African-Americans, and Hispanics are most responsive to cigarette price increases. For example, adults with income at or below the median are more than four times as price-responsive as those with income above the median.
We estimate a generalized linear model to examine adult and teenage cigarette demand. Out analysis focuses on the extent to which excise taxes and regulations restricting smoking in public places affect cigarette consumption. The adult results indicate that the price elasticity of demand is unstable over time, ranging from 0.06 in 1970 to -0.23 in 1985. These estimates are lower than most found in previous studies. The teenage price elasticity does not differ statistically from the estimates for adults. Additionally, regulations restricting smoking in public places have a significant effect on both adult and teenage cigarette demand.
The large tax differentials between Chicago and neighboring jurisdictions provide an incentive for cigarette tax avoidance. Data from a random sample of cigarette packs littered in Chicago reveals a startling degree of tax avoidance: three-quarters did not display a Chicago tax stamp. Also, the $2.68 difference between the tax in Chicago and surrounding counties decreases the probability of a local stamp by almost 60 percent, and a one mile increase in distance to the lower-tax state border increases the probability a pack of a local stamp by about one percent. These results are consistent with the predictions of economic theory. (JEL H25, H26, H71)
Using a statistical matching procedure to choose control groups, we find that four states that adopted large cigarette tax hikes had corresponding decreases in smoking participation of pregnant women. Using the tax hike as an instrument for smoking in birth-weight equations and pooling data across experiments, we find that smoking during pregnancy doubles the chance an infant is born with a low birth weight. Our estimates are similar to singleequation estimates where maternal smoking is treated as exogenous.
Health economists often use log models to deal with skewed outcomes, such as health utilization or health expenditures. The literature provides a number of alternative estimation approaches for log models, including ordinary least-squares on ln(y) and generalized linear models. This study examines how well the alternative estimators behave econometrically in terms of bias and precision when the data are skewed or have other common data problems (heteroscedasticity, heavy tails, etc.). No single alternative is best under all conditions examined. The paper provides a straightforward algorithm for choosing among the alternative estimators. Even if the estimators considered are consistent, there can be major losses in precision from selecting a less appropriate estimator.
Using data from the 1979 and 1987 National Health Interview Survey (NHIS), we test whether smokers alter their smoking habits in the face of higher taxes. Smokers in high-tax states are more likely to smoke cigarettes higher in tar and nicotine. Although taxes reduce the number of cigarettes consumed per day among remaining smokers, total daily tar and nicotine intake is unaffected. Young smokers, aged 18-24, are much more responsive to changes in taxes than are older smokers, and their total daily tar and nicotine intake actually increases after a tax hike. We illustrate that tax-induced compensating behavior may eliminate some health benefits generated by reduced smoking participation. A more appropriate tax might be based on the tar and nicotine content of cigarettes.
Estimating elasticities of cigarette demand has become commonplace amongst economists and policymakers. Synthesizing the various elasticities into a coherent message is quite challenging, however, as the point estimates are obtained using quite disparate modeling techniques and data. In this study, we perform a meta-analysis to explore factors that influence variations within and across studies. Empirical results suggest that demand specification, data issues, and estimation methodology have varying degrees of influence on reported estimates of price, income, and advertising elasticities.
Variation in state cigarette taxes provides incentives for tax avoidance through smuggling, legal border crossing to low tax jurisdictions, or Internet purchasing. When taxes rise, tax paid sales of cigarettes will decline both because consumption will decrease and because tax avoidance will increase. The key innovation of this paper is to compare cigarette sales data to cigarette consumption data from the Behavioral Risk Factor Surveillance System (BRFSS). I show that after subtracting percent changes in consumption, residual percent changes in sales are associated with state cigarette tax changes implying the existence of tax avoidance. I estimate that the tax avoidance response to tax changes is at least twice the consumption response and that tax avoidance accounted for up to 9.6% of sales between 1985 and 2001. Because of the increase in tax avoidance, tax paid sales data understate the level of smoking and overstate the drop in smoking. I also find that the level of legal border crossing was very low relative to other forms of tax avoidance. If states have strong preferences for smoking control, they must pair high cigarette taxes with effective policies to curb smuggling and other forms of tax avoidance or employ alternative policies such as counter-advertising and smoking restrictions.
While recent evidence casts some doubt, it is generally accepted that the price sensitivity of smoking varies inversely with age. We investigate the responsiveness of older adult smoking using variation from recent historically large cigarette tax increases in the United States. Using data from the Behavioral Risk Factor Surveillance System from 2000 to 2005, we find consistent evidence that higher taxes reduced smoking participation by older adults, especially those who are less educated and live in low-income households. Our findings run contrary to existing evidence which suggests that cessation behavior by older adults is not sensitive to price. Since a large literature suggests smoking cessation even later in life reduces morbidity and increases longevity, our findings may represent substantial gains in health among tax-induced quitters.
This article examines the impact of cigarette prices and smoke-free air laws on adult smoking. Probit methods and a generalized linear model with log-link and Gaussian distribution are employed to model adult smoking propensity and intensity, respectively. After controlling for unobserved state-level heterogeneity, which can influence both tobacco policy and smoking behavior, the estimates from this study imply that an inverse relationship exists between cigarette prices and both smoking prevalence and average cigarette consumption by adult smokers. The estimates also imply that more restrictive smoke-free air laws decrease average smoking by adult smokers but have little impact on prevalence. (JEL I18) Copyright 2006, Oxford University Press.
While the tobacco industry is among the most substantial and successful economic enterprises, tobacco consumption kills more people than any other product. Economic analysis of tobacco product markets, particularly for cigarettes, has contributed considerable insight to debates about the industry's importance and appropriate public policy roles in grappling with health consequences of tobacco. The most significant example is the rapidly expanding and increasingly sophisticated body of research on the effects of price increases on cigarette consumption. Because excise tax is a component of price, the resultant literature has been prominent in legislative debates about taxation as a tool to discourage smoking, and has contributed theory and empirical evidence to the growing interest in modeling demand for addictive products. This chapter examines the research and several equity and efficiency concerns accompanying cigarette taxation debates. It includes economic analysis of other tobacco control policies, such as advertising restrictions, prominent in tobacco control debates. Research addressing the validity of tobacco-industry arguments that its contributions to employment, tax revenues, and trade balances are vital to economic health in states and nations is also considered, as it is the industry's principal weapon in the battle against policy measures to reduce tobacco consumption.
Federal and state governments in the United States use income and payroll taxes as their primary tools to collect revenue. Relative to the United States, governments in the rest of the world rely much more heavily on taxing consumption. Heavy American reliance on income rather than consumption taxation has not served the U.S. economy well. The inefficiency associated with taxing the return to capital means that the tax system reduces investment in the United States and distorts intertemporal consumption by Americans. While the economic logic of consumption taxation is compelling even for a closed economy, it is even more powerful for an open economy exposed to the world capital market. Consumption taxes in the form of excises can be designed to help protect the environment and control other externalities. Excise taxes can also serve the function of more closely aligning tax burdens with the benefits that taxpayers receive from certain government services. Understandable concerns arise about the distributional consequences of consumption taxation, but a system that relies heavily on consumption taxes, particularly if accompanied by an income tax, can be as progressive as any income tax the United States would realistically want to adopt.
In this paper, we develop an econometric model to estimate the impacts of Electronic Vehicle Management Systems (EVMS) on the load factor (LF) of heavy trucks using data at the operational level. This technology is supposed to improve capacity utilization by reducing coordination costs between demand and supply. The model is estimated on a subsample of the 1999 National Roadside Survey, covering heavy trucks travelling in the province of Quebec. The LF is explained as a function of truck, trip and carrier characteristics. We show that the use of EVMS results in a 16 percentage points increase of LF on backhaul trips. However, we also find that the LF of equipped trucks is reduced by about 7.6 percentage points on fronthaul movements. This last effect could be explained by a rebound effect: higher expected LF on the returns lead carriers to accept shipments with lower fronthaul LF. Overall, we find that this technology has increased the tonne-kilometers transported of equipped trucks by 6.3% and their fuel efficiency by 5%.
Tobacco Taxes: A Win-Win-Win for Cash Strapped States://rwjf.org/files/research/20100209tobaccotax.pdf
- Tobacco Campaign
- Free
- Tobacco Campaign
- Free
Tobacco Taxes: A Win-Win-Win for Cash Strapped States The Economics of Smoking
- Tobacco Campaign
- Free
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Excise Tax Avoid-ance: The Case of State Cigarette Taxes NBER Working Paper 15941 Who Pays Cigarette Taxes? The Impact of Con-sumer Price Search The Compensating Behavior of Smokers: Taxes, Tar and Nicotene
- P Decicca
- D S Kenkel
- F Liu Evans
- M C Farrelly
DeCicca, P., D. S. Kenkel, and F. Liu. " Excise Tax Avoid-ance: The Case of State Cigarette Taxes. " NBER Working Paper 15941, National Bureau of Economic Research, 2010a.. " Who Pays Cigarette Taxes? The Impact of Con-sumer Price Search. " NBER Working Paper 15942, National Bureau of Economic Research, 2010b. Evans, W. N., and M. C. Farrelly. " The Compensating Behavior of Smokers: Taxes, Tar and Nicotene. " RAND Journal of Economics, 29(3), 1998, 578–95.
Tobacco Taxes, Smoking Restrictions, and Tobacco Use, " in The Economic Analysis of Substance Use and Abuse: An Integration of Econometrics and Behavioral Eco-nomic Research
- R L Ohsfeldt
- R G Boyle
- E I Capilouto
Ohsfeldt, R. L., R. G. Boyle, and E. I. Capilouto. " Tobacco Taxes, Smoking Restrictions, and Tobacco Use, " in The Economic Analysis of Substance Use and Abuse: An Integration of Econometrics and Behavioral Eco-nomic Research, edited by F. J. Chaloupka, M. Gross-man, W. K. Bickel, and H. Saffer. Chicago, IL: Uni-versity of Chicago Press, 1999. Orzechowski, W., and R. C. Walker. Tax Burden on Tobacco: Historical Compliation, Vol. 44. Arlington, VA: Orzechowski and Walker, 2009.
Tobacco Taxes: A Win-Win-Win for Cash Strapped States
- Campaign For Tobacco Free
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The Economic Analysis of Substance Use and Abuse: An Integration of Econometrics and Behavioral Economic Research
- R L Ohsfeldt
- R G Boyle
- E I Capilouto
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Restrictions, and Tobacco Use. In Chaloupka et al (Eds.), The Economic Analysis
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Arlington, VA: Orzechowski and Walker.