This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Taxes, Cigarette Consumption, and Smoking Intensity

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Jérôme Adda
Francesca Cornaglia

Additional information is available for the following registered author(s):

Abstract

This paper analyses the compensatory behavior of smokers. Exploiting data on cotinine concentration—a metabolite of nicotine—measured in a large population of smokers over time, we show that smokers compensate for tax hikes by extracting more nicotine per cigarette. Our study makes two important contributions. First, as smoking a given cigarette more intensively is detrimental to health, our results question the usefulness of tax increases. Second, we develop a model of rational addiction where agents can also adjust their intensity of smoking, and we show that the previous empirical results suffer from estimation biases. (JEL D12, H25, I12)

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://hdl.handle.net/10.1257/aer.96.4.1013
File Format: text/html
File Function:
Download Restriction: no
File URL: http://www.aeaweb.org/articles/article_detail.php?journal=AER&volume=96&issue=4&article=5&issue_date=September2006
File Format: application/pdf
File Function:
Download Restriction: Access to full text is restricted to AEA members.
File URL: http://www.e-aer.org/data/sept06/20040645_data.zip
File Format: application/zip
File Function: dataset accompanying article
Download Restriction: no

Publisher Info
Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 96 (2006)
Issue (Month): 4 (September)
Pages: 1013-1028
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:aea:aecrev:v:96:y:2006:i:4:p:1013-1028

Contact details of provider:
Email:
Web page: http://www.aeaweb.org/aer/
More information through EDIRC

Order Information:
Web: http://www.aeaweb.org/subscribe.html

For technical questions regarding this item, or to correct its listing, contact: (Christopher F. Baum).

Related research
Keywords:

Other versions of this item:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Harris, Jeffrey E, 1980. "Taxing Tar and Nicotine," American Economic Review, American Economic Association, vol. 70(3), pages 300-311, June. [Downloadable!] (restricted)
  2. Jerome Adda & Francesca Cornaglia, 2005. "The effects of taxes and bans on passive smoking," CeMMAP working papers CWP20/05, Centre for Microdata Methods and Practice, Institute for Fiscal Studies. [Downloadable!]
    Other versions:
  3. Chaloupka, Frank, 1991. "Rational Addictive Behavior and Cigarette Smoking," Journal of Political Economy, University of Chicago Press, vol. 99(4), pages 722-42, August. [Downloadable!] (restricted)
    Other versions:
  4. William N. Evans & Matthew C. Farrelly, 1998. "The Compensating Behavior of Smokers: Taxes, Tar, and Nicotine," RAND Journal of Economics, The RAND Corporation, vol. 29(3), pages 578-595, Autumn. [Downloadable!] (restricted)
  5. Jonathan Gruber & Botond Koszegi, 2000. "Is Addiction "Rational"? Theory and Evidence," NBER Working Papers 7507, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  6. Jonathan Gruber & Botond Köszegi, 2001. "Is Addiction "Rational"? Theory And Evidence," The Quarterly Journal of Economics, MIT Press, vol. 116(4), pages 1261-1303, November. [Downloadable!] (restricted)
  7. Philip DeCicca & Donald Kenkel & Alan Mathios, 2002. "Putting Out the Fires: Will Higher Taxes Reduce the Onset of Youth Smoking?," Journal of Political Economy, University of Chicago Press, vol. 110(1), pages 144-169, February. [Downloadable!] (restricted)
  8. Gary S. Becker & Michael Grossman & Kevin M. Murphy, 1994. "An Empirical Analysis of Cigarette Addiction," NBER Working Papers 3322, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  9. Chaloupka, Frank J. & Warner, Kenneth E., 2000. "The economics of smoking," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 29, pages 1539-1627 Elsevier. [Downloadable!] (restricted)
    Other versions:
  10. M.C. Farrelly & C.T. Nimsch & A. Hyland & M. Cummings, 2004. "The effects of higher cigarette prices on tar and nicotine consumption in a cohort of adult smokers," Health Economics, John Wiley & Sons, Ltd., vol. 13(1), pages 49-58. [Downloadable!]
  11. Becker, Gary S & Murphy, Kevin M, 1988. "A Theory of Rational Addiction," Journal of Political Economy, University of Chicago Press, vol. 96(4), pages 675-700, August. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Timothy K.M. Beatty, Erling Røed Larsen and Dag Einar Sommervoll, 2007. "Driven to Drink. Sin Taxes Near a Border," Discussion Papers 507, Research Department of Statistics Norway. [Downloadable!]
  2. Jérôme Adda & Francesca Cornaglia, 2006. "The Effect of Taxes and Bans on Passive Smoking," CEPR Discussion Papers 509, Centre for Economic Policy Research, Research School of Social Sciences, Australian National University. [Downloadable!]
    Other versions:
  3. Emma Tominey, 2007. "Maternal Smoking During Pregnancy and Early Child Outcomes," CEP Discussion Papers dp0828, Centre for Economic Performance, LSE. [Downloadable!]
  4. Kaplanoglou, G. & Newbery , D.M., 2008. "Horizontal Inequity and Vertical Redistribution with Indirect Taxes: the Greek Case," Cambridge Working Papers in Economics 0806, Faculty of Economics, University of Cambridge. [Downloadable!]
    Other versions:
  5. Chung-Ping Loh & Chin-Shyan Chen & Tsai-Ching Liu, 2009. "Multiple Dimensions of Cigarette Smoking and Responsiveness to Cigarette Price Changes in Taiwan," Journal of Family and Economic Issues, Springer, vol. 30(2), pages 203-213, June. [Downloadable!] (restricted)
  6. Labonne, Julien & Chase, Robert S., 2008. "So you want to quit smoking : have you tried a mobile phone ?," Policy Research Working Paper Series 4657, The World Bank. [Downloadable!]
  7. Ian Irvine, 2008. "Smoking Intensity, Compensatory Behavior and Tobacco Tax Policy," Working Papers 200818, Geary Institute, University College Dublin. [Downloadable!]
  8. Jérôme Adda, 2007. "Behavior towards health risks: An empirical study using the “Mad Cow” crisis as an experiment," Journal of Risk and Uncertainty, Springer, vol. 35(3), pages 285-305, December. [Downloadable!] (restricted)
Statistics
Access and download statistics

Did you know? You too can volunteer with RePEc.

This page was last updated on 2009-11-16.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.