The Economics of Tobacco Regulation: A Comprehensive Review

Abstract

We gratefully acknowledge funding for this research from the National Institutes of Health, grant number 1R01DA042064-01A1. We thank Anne Burton and Hua Wang for excellent research assistance, and William Kenkel for advice about the neurology of nicotine addiction. Researchers' own analyses calculated (or derived) based in part on data from The Nielsen Company (US), LLC and marketing databases provided through the Nielsen Datasets at the Kilts Center for Marketing Data Center at The University of Chicago Booth School of Business. The conclusions drawn from the Nielsen data are those of the researchers and do not reflect the views of Nielsen. Nielsen is not responsible for, had no role in, and was not involved in analyzing and preparing the results reported herein. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w26923.ack NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

The Effects of E-Cigarette Taxes on E-Cigarette Prices and Tobacco Product Sales: Evidence from Retail Panel Data

“…These coefficient estimates translate into own-price elasticities of roughly -1.30 and -0.39, respectively. 26 The cigarette price elasticity is in line with many previous estimates of the price elasticity of demand for cigarettes (Chaloupka and Warner 2000, DeCicca et al 2018, DeCicca, Kenkel, and Lovenheim 2020.…”

Cigarette taxes, smoking, and health in the long run

“…First, teenage smoking is particularly sensitive to cigarette taxes, especially among the cohorts for whom we can observe mortality (Carpenter and Cook 2008;Lillard et al 2013;Hansen et al 2017). 1 Second, most smokers take up the habit before reaching the age of 20 (Lillard et al 2013;Holford et al 2014), and teenage smoking is strongly correlated with smoking later in life (Chassin et al 1996;Gruber 2001;Glied 2002; 1 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). Gilleskie and Strumpf 2005), suggesting that cigarette taxes experienced as a teenager are a plausibly exogenous source of variation in lifetime smoking.…”

Cigarette Taxes, Smoking, and Health in the Long-Run

“…First, teenage smoking is particularly sensitive to cigarette taxes, especially among the cohorts for whom we can observe mortality (Carpenter and Cook 2008;Lillard et al 2013;Hansen et al 2017). 1 Second, most smokers take up the habit before reaching the age of 20 (Lillard et al 2013;Holford et al 2014), and teenage smoking is strongly correlated with smoking later in life (Chassin et al 1996;Gruber 2001;Glied 2002; 1 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). Gilleskie and Strumpf 2005), suggesting that cigarette taxes experienced as a teenager are a plausibly exogenous source of variation in lifetime smoking.…”