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Cigarette smoking and self-control

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Abstract

This paper empirically studies time inconsistent preferences in the context of cigarette smoking behavior. With hyperbolic discounting, an individual has time inconsistent preferences, which give rise to a lack of self-control, i.e., she may perpetually postpone the execution of a plan. This implies that a smoker who wants to quit has a demand for control devices, e.g., a smoking ban in public areas or a hike in cigarette excise taxes. This paper empirically tests this implication, using a sample that is based on survey data from Taiwan. The estimation results indicate that a smoker’s intention to quit has a positive effect on the smoker’s support for smoking bans and a cigarette excise tax increase. These results suggest that time inconsistent preferences are valid in the context of cigarette smoking behavior. This casts doubt on the validity of the assumption that individuals have time consistent preferences in Becker and Murphy’s (1988) rational addiction model.

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Bibliographic Info

Paper provided by Institute of Economics, Academia Sinica, Taipei, Taiwan in its series IEAS Working Paper : academic research with number 06-A004.

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Length: 39 pages
Date of creation: Jul 2006
Date of revision:
Handle: RePEc:sin:wpaper:06-a004

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References

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