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The continuum-of-addiction: cigarette smoking in relation to price among Americans aged 15-29

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  • Jeffrey E. Harris

    (Department of Economics, Massachusetts Institute of Technology, Cambridge, MA, USA)

  • Sandra W. Chan

    (Department of Economics, Massachusetts Institute of Technology, Cambridge, MA, USA)

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    Abstract

    We studied the relationship between current cigarette smoking and price among 34-145 respondents, aged 15-29 years, to the 1992-1993 Tobacco Use Supplements to the Current Population Survey. The price elasticity of current smoking varied inversely with age: −0.831 (S.E. 0.402) for ages 15-17; −0.524 (S.E. 0.256) for ages 18-20; −0.370 (S.E. 0.188) for ages 21-23; −0.202 (S.E. 0.175) for ages 24-26; and −0.095 (S.E. 0.157) for ages 27-29. In response to higher prices, older youth were more likely to reduce the number of cigarettes smoked per day than to quit entirely. Among 15-17-year-olds, smoking cigarettes 'some days' was more sensitive to price than smoking 'every day'. Cigarette smoking was inversely related to the prices of premium brands, but not discount brands. Copyright © 1999 John Wiley & Sons, Ltd.

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    Bibliographic Info

    Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

    Volume (Year): 8 (1999)
    Issue (Month): 1 ()
    Pages: 81-86

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    Handle: RePEc:wly:hlthec:v:8:y:1999:i:1:p:81-86

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    Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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    References

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    1. DeCicca, Philip & Kenkel, Donald & Mathios, Alan, 2000. "Putting Out The Fires: Will Higher Taxes Reduce Youth Smoking?," Working Papers 00-3, University of Aarhus, Aarhus School of Business, Department of Economics.
    2. Gary S.Grossman Becker & Michael Murphy & Kevin M., 1991. "Rational Addiction and the Effect of Price on Consumption," University of Chicago - George G. Stigler Center for Study of Economy and State 68, Chicago - Center for Study of Economy and State.
    3. 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.
    4. Lewit, Eugene M. & Coate, Douglas, 1982. "The potential for using excise taxes to reduce smoking," Journal of Health Economics, Elsevier, vol. 1(2), pages 121-145, August.
    5. Becker, Gary S & Grossman, Michael & Murphy, Kevin M, 1994. "An Empirical Analysis of Cigarette Addiction," American Economic Review, American Economic Association, vol. 84(3), pages 396-418, June.
    6. Chaloupka, Frank J. & Wechsler, Henry, 1997. "Price, tobacco control policies and smoking among young adults," Journal of Health Economics, Elsevier, vol. 16(3), pages 359-373, June.
    7. Wasserman, Jeffrey & Manning, Willard G. & Newhouse, Joseph P. & Winkler, John D., 1991. "The effects of excise taxes and regulations on cigarette smoking," Journal of Health Economics, Elsevier, vol. 10(1), pages 43-64, May.
    8. Frank J. Chaloupka & Michael Grossman, 1996. "Price, Tobacco Control Policies and Youth Smoking," NBER Working Papers 5740, National Bureau of Economic Research, Inc.
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    Citations

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    Cited by:
    1. Devereux, Michael P & Lockwood, Ben & Redoano, Michela, 2004. "Horizontal and Vertical Indirect Tax Competition: Theory and Some Evidence From the USA," CEPR Discussion Papers 4470, C.E.P.R. Discussion Papers.
    2. Jeffrey E. Harris & Beatriz Lopez-Valcarcel, 2004. "Asymmetric Social Interaction in Economics: Cigarette Smoking Among Young People in the United States, 1992-1999," NBER Working Papers 10409, National Bureau of Economic Research, Inc.
    3. Philip DeCicca & Donald Kenkel & Alan Mathios & Yoon-Jeong Shin & Jae-Young Lim, 2008. "Youth smoking, cigarette prices, and anti-smoking sentiment," Health Economics, John Wiley & Sons, Ltd., vol. 17(6), pages 733-749.
    4. Okechukwu, Cassandra & Bacic, Janine & Cheng, Kai-Wen & Catalano, Ralph, 2012. "Smoking among construction workers: The nonlinear influence of the economy, cigarette prices, and antismoking sentiment," Social Science & Medicine, Elsevier, vol. 75(8), pages 1379-1386.
    5. Nicholas Apergis & Rajeev Goel & James Payne, 2014. "Dynamics of U.S. State Cigarette Consumption: Evidence from Panel Error Correction Modeling," Atlantic Economic Journal, International Atlantic Economic Society, vol. 42(1), pages 3-20, March.
    6. Lillard, Dean R. & Molloy, Eamon & Sfekas, Andrew, 2013. "Smoking initiation and the iron law of demand," Journal of Health Economics, Elsevier, vol. 32(1), pages 114-127.
    7. Martin Forster & Andrew Jones, 2000. "The role of tobacco taxes in starting and quitting smoking: duration analysis of British data," Working Papers 176chedp, Centre for Health Economics, University of York.
    8. Anindya Sen & Tony Wirjanto, 2010. "Estimating the impacts of cigarette taxes on youth smoking participation, initiation, and persistence: empirical evidence from Canada," Health Economics, John Wiley & Sons, Ltd., vol. 19(11), pages 1264-1280.
    9. Lisa Farrell & Tim R. L. Fry & Mark N. Harris, 2003. "“A Pack A Day For Twenty Years”:Smoking And Cigarette Pack Sizes," Department of Economics - Working Papers Series 887, The University of Melbourne.
    10. Mark N. Harris & Xueyan Zhao, 2004. "Modelling Tobacco Consumption with a Zero-Inflated Ordered Probit Model," Monash Econometrics and Business Statistics Working Papers 14/04, Monash University, Department of Econometrics and Business Statistics.

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