The effect of tobacco expenditure on expenditure shares in South African households: A genetic matching approach

Chelwa, Grieve; Koch, Steven F.

doi:10.1371/journal.pone.0222000

Cited by 13 publications

(13 citation statements)

References 18 publications

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“…Chelwa and Koch 19 avoided using instrumental variables but instead used Genetic Matching to expenditure quartiles to ascertain the effect of tobacco on other household expenditure. They found that food was crowded out by tobacco in the poorest households.…”

Section: Introductionmentioning

confidence: 99%

Does tobacco expenditure influence household spending patterns in Ghana?: Evidence from the Ghana 2012/2013 Living Standards Survey

Masa-ud¹,

Chelwa²,

Walbeek³

2020

Tob. Induc. Dis.

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INTRODUCTION There is a growing literature on the 'crowding-out' effects of tobacco expenditure, particularly in Low-to-Middle Income Countries (LMICs). However, there is no published study investigating these effects in the context of Ghana, a country where tobacco consumption is expected to increase in the future. This study aims to investigate whether tobacco influences expenditure patterns within Ghanaian households. METHODS We estimate a demand system of quadratic conditional Engel curves for a set of twelve groups of commodities using the 2012/2013 Ghana Living Standards Survey. Unlike previous studies we use the GMM 3SLS estimator, which provides more efficient parameter estimates due to heteroskedastic errors inherent in crosssectional datasets of this nature. RESULTS The results show that Ghanaian households that spend on tobacco are more likely to spend also on alcohol, recreation, transport and communications, but less on food, housing, and health needs. CONCLUSIONS Tobacco expenditure, through its 'crowding-in' effects on alcohol and 'crowding-out' effects on food and health expenditure worsens household welfare in Ghana.

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Section: Introductionmentioning

confidence: 99%

Does tobacco expenditure influence household spending patterns in Ghana?: Evidence from the Ghana 2012/2013 Living Standards Survey

Masa-ud¹,

Chelwa²,

Walbeek³

2020

Tob. Induc. Dis.

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“…The QUAIDS model in this study was carried out to account for socio-demographic (z) effects on animal products' demand. Essentially, demographic factors can influence household behavior in terms of demand and expenditure allocated among goods [27,[30][31][32][33][34]. Further, a 'demographic scaling' method was used in this current research, which was referred to [35].…”

Section: Model Specification: Quadratic Almost Ideal Demand System (Q...mentioning

confidence: 99%

Implementation of demand system restrictions and accuracy of QUAIDS model estimator on animal food demand in Indonesia

Iriany

Sui²,

Anindita

et al. 2022

EEJET

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Demonstration on restrictions and accuracy of an estimator is pivotal since the incomplete restrictions will make the estimator inaccurate that they cannot be used for the need of decision making. In this study, the demand system’s three primary requirements-adding up, homogeneity, and symmetry ‒ are examined. This current research was intended to demonstrate restrictions and accuracy of Quadratic Almost Ideal Demand System (QUAIDS) model estimator. The source of the data was referred to the results of National Socio-Economic Survey of Indonesia in 2016, involving 291,414 households in total. Iterated Nonlinear Seemingly Unrelated Regression method was used for the estimation procedure. Parameter estimation is used to calculate the elasticity of animal protein. The results have indicated that the three restrictions of the QUAIDS model estimator, i. e. adding up, homogeneity, and symmetry, have been completed. Further, the estimation made by the QUAIDS model is valid and efficient; therefore, the estimation is potentially used as a means of calculating own and cross price elasticity, either Marshallian or Hicksian. In addition, some other parameters, such as price, income, and income squared, are also employed to calculate income elasticity. The findings show that demand is elastic for all animal proteins, except for eggs, which are inelastic. Beef is most elastic. According to the income elasticity results, all animal proteins are considered luxury foods in Indonesia, except for eggs, which have an income elasticity of less than one. To fulfill Indonesian households’ needs for animal protein, the income policy is more suited for beef, while the price strategy is more effective for animal proteins including chicken, milk, fresh fish, and eggs

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“…Since the first studies in the early 2000s,1 2 research especially from low and middle-income countries (LMIC) analysed the crowding out effect of spending on tobacco and consistently found evidence that this effect negatively affected spending on mainly basic necessities 3–22…”

Section: Introductionmentioning

confidence: 99%

Impact of tobacco spending on intrahousehold resource allocation in Montenegro

2023

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BackgroundThe main goal of this study is to estimate the crowding out impact of tobacco expenditures on the household budget allocation to other mutually exclusive commodity groups in Montenegro.MethodologyThe analysis uses the Household Budget Survey data from 2005 to 2017 to estimate a system of Engel curves using a three-stage least squares approach. As the tobacco expenditure variable is endogenous to budget shares on other consumption items, instrumental variables were included to obtain consistent estimates.ResultsOverall, the results confirm the existence of the crowding out effect of tobacco spending on various commodities, such as some food items (eg, cereals, fruits and vegetables and dairy products), clothing, housing and utilities, education and recreation while a positive effect of tobacco consumption was estimated on budget shares on bars and restaurants, alcohol, coffee and sugary drinks. These results are consistent throughout the income groups of households. The estimates indicate that an increase in tobacco expenditures leads to reduction in budget shares on essential goods, which is likely to have negative impacts on the household living standard.ConclusionsTobacco expenditure crowds out household spending on necessities, especially in case of the poorest households, thus increasing inequality, hampering human capital development and potentially causing long-term adverse effects on the households in Montenegro. Our results are similar to evidence from other low and middle-income countries. This paper contributes to the analysis of the crowding out effect of tobacco consumption, which was conducted for the first time in Montenegro.

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The effect of tobacco expenditure on expenditure shares in South African households: A genetic matching approach

Cited by 13 publications

References 18 publications

Does tobacco expenditure influence household spending patterns in Ghana?: Evidence from the Ghana 2012/2013 Living Standards Survey

Does tobacco expenditure influence household spending patterns in Ghana?: Evidence from the Ghana 2012/2013 Living Standards Survey

Implementation of demand system restrictions and accuracy of QUAIDS model estimator on animal food demand in Indonesia

Impact of tobacco spending on intrahousehold resource allocation in Montenegro

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