Response to Health Information: Evidence from Cigarette Consumption and Intake of Nicotine and Tar in Japan
AbstractThis paper introduces a new way to examine the effects of mandatory information disclosure on inter-brand cigarette demands and the behavior of a monopolistic firm in Japan. I estimated inter-brand demands by including nicotine, tar content, and policy event information in the model and by using cigarette brand sales data. I found that the mandatory disclosure of nicotine and tar content information decreased the intake of nicotine and tar per capita and per smoker; thus mandatory disclosure is likely to increase consumersf welfare, if we suppose that they always choose their favorite cigarette. Furthermore, I found that the monopolistic firm supplied more, new, and better quality products, discontinued the production of poorer quality goods, and conducted more R & D, in response to disclosure mandates.
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Bibliographic InfoPaper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 04-12.
Length: 23 pages
Date of creation: Jun 2004
Date of revision:
Rational addiction; Smoking; Health information; Tobacco control;
Find related papers by JEL classification:
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-06-19 (All new papers)
- NEP-HEA-2005-06-19 (Health Economics)
- NEP-SEA-2005-06-19 (South East Asia)
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