PurposeThe objective of this article is to examine the factors associated with smoking of flavor capsule cigarettes in Chile, where the popularity of these products has increased dramatically, a trend increasingly observed across the world.MethodsA representative poll of 851 smokers in Metropolitan Santiago de Chile, which comprises 40% of the country's total population, was implemented in mid-2017. Smokers were given a questionnaire that collected socio-demographic information and information on smoking patterns. Four discrete-choice models were estimated on the decision to smoke flavor capsule cigarettes to better understand the statistical relationships between traits of smokers and the consumption of flavor capsule cigarettes.ResultsThe results of these models show that each year less in a smoker’s age increases the likelihood of preferring flavor capsule cigarettes by, on average, between 0.8 and 0.9 percentage points. If the smoker is a woman, the likelihood of preferring flavor capsule cigarettes increases between 13.4 and 13.5 percentage points. Results also reveal a positive relationship between the price paid and the consumption of flavor capsule cigarettes, indicating that these cigarettes tend to be more expensive. There is no statistical relationship between participation in the labor market and smoking these products.ConclusionsChile has the world’s highest prevalence of flavor capsule cigarette smoking, which is concentrated among young people (25 years and younger) and females. No relationship between socioeconomic status and use of these products is found, though there are indications that such relationship may exist, as they were at the time of study 14% more expensive, on average, than conventional non-flavored cigarettes. As in most countries, the tobacco industry appears to be deliberately promoting these products with the goal of halting or slowing the decline in cigarette consumption in Chile. Thus, to reduce cigarette consumption (especially among youth), restricting or forbidding cigarette flavorings of all types, including flavor capsules, would be an effective strategy.

ObjectiveTo estimate with a rigorous statistical methodology and independent from the tobacco industry the prevalence and consumption of illicit cigarettes in Metropolitan Santiago de Chile, in addition to identifying the variables statistically associated with choosing to smoke illicit cigarettes.MethodsSurveys of 851 smokers who reside in the Metropolitan Santiago were collected using a sampling design that combined a randomisation of high-traffic points and a quota sampling to approximate the smoking population. Photographs of packs along with questions on where they were bought were used to define whether cigarettes were licit or illicit. After this identification, the statistical association between the decision to smoke illicit cigarettes and sociodemographic variables and smoking habits was estimated using probit models.ResultsThe proportion of smokers smoking illicit cigarettes in Metropolitan Santiago was 10.9%. Adjusted by smoking intensity, 16.3% of cigarettes smoked in a month were illicit. Models show that the probability of smoking illicit cigarettes is inversely associated with employment status (ie, employed/inactive/unemployed), and smokers with lower levels of education are more likely to smoke illicit cigarettes. Though smokers’ incomes are not directly measured, both employment status and educational levels are indicative that illicit cigarette consumption is more prevalent among low-income groups.ConclusionsThe proportion of smokers consuming illicit cigarettes estimated in this research is less than half of the widely publicised claims of the tobacco industry. Furthermore, past and present pricing strategies by the tobacco industry indicate that, contrary to public statements, the tobacco industry is not concerned by illicit trade.

ObjectiveTo estimate the degree to which tobacco consumption is associated with spending on a set of goods and services in Chile, especially health and education, for the total population as well as for specific subgroups.MethodsA seemingly unrelated regression equation system was used to estimate the statistical relationship between having tobacco expenditures and the budget share allocated to other items for the total population and for specific subgroups in Chile (eg, households within the bottom/top 33% by total expenditures). The use of household-level data allows for the control of a number of sociodemographic characteristics. The nationally representative 2012 Chilean Household Expenditure Survey was used for the analysis.ResultsTobacco consumption is associated with lower budget shares allocated to healthcare, education and housing expenses, especially for poorer households. In the case of health, not consuming tobacco is related to higher health expenditures: up to 32% for the total population. Similarly, in the case of education, not consuming tobacco is statistically related to higher education expenditures: up to 16% for the total population. For all groups, tobacco consumption is also related to a significantly higher budget share allocated to alcoholic beverages.ConclusionsThe strong significant statistical relationship found between tobacco consumption and resources allocated to healthcare and education consumption may be indicative of the existence of a crowding out effect of tobacco. This effect, in turn, may increase the burden that the rest of society must bear for the increased healthcare that they require because of tobacco consumption.

Introduction and objectiveChile is among the countries with the highest alcohol consumption per capita in Latin America, but little has been done in the way of public policy and policy research to overcome this problem. The objective of the present study is to estimate demand elasticities (own-price, cross-price, expenditure and quality) for three groups of alcoholic beverages in Chile: spirits, wines, and beers.Data and methodsThe study uses data from the VII Encuesta de Presupuestos Familiares (Family Budget Survey) 2011–2012 conducted by the National Institute of Statistics. Because of problems with the quality of the measurement units, hot-deck imputation method was used with the alcohol purchases that presented problems. To estimate the demand elasticities, the Almost Ideal Demand System (AIDS) method proposed by Deaton was used. Quality decisions were estimated for each beverage separately using an equation proposed by Deaton in the three-step AIDS.ResultsThe estimated elasticities were more inelastic for spirits (-0.14, P<0.01), followed by wines (-0.77, P<0.01) and beers (-0.93, P<0.01). Spirits reported less sensitivity to changes in the total budget, while wines reported the most sensitivity to changes in the total budget (expenditure elasticity). Wines also reported the most sensitivity related to quality for changes in the total budget (0,20, meaning that a 10% increase in a household’s total expenditure increases the “quality” of purchased wines by 2%).ConclusionsOwn-price elasticities reported for spirits, wines and beers are consistently negative, and inelastic, in line with international evidence. Although own-price elasticities for spirits is more inelastic than found in most studies, its quality-elasticity is more positive and greater. This could be explained by the greater price dispersion of spirits, as well as spirits (and wine) being consumed more than beers in Chile. This in turn may be because consumers have the option of switching to cheaper, Chilean-produced spirits such as pisco and wines when prices rise. The existence of these relatively broad quality-elasticities points to the need for a change in the alcohol tax structure from the current ad-valorem tax to a specific tax that could reduce price dispersion and curb total consumption.

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