The Economics of Smoking Bans
AbstractWhile the empirical literature on smoking bans is extensive, little theory has been developed. This paper examines the welfare impact of smoking bans in an economy where smokers’ utility is reduced by a workplace/public place ban. The government has two instruments - increasing the price through taxation, or limiting when the product can be consumed through a ban. Its ability to reduce smoking through taxation is limited by a black market where cigarettes are not taxed. We show that the quantity instrument (ban) is always welfareenhancing. The model has application to other addictive activities.
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Bibliographic InfoPaper provided by Geary Institute, University College Dublin in its series Working Papers with number 201027.
Length: 48 pages
Date of creation: 01 May 2010
Date of revision:
smoking; workplace ban; public place ban; government control; taxation;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-05-29 (All new papers)
- NEP-HEA-2010-05-29 (Health Economics)
- NEP-MIC-2010-05-29 (Microeconomics)
- NEP-PBE-2010-05-29 (Public Economics)
- NEP-REG-2010-05-29 (Regulation)
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.:
- Joni Hersch, 2005. "Smoking Restrictions as a Self-Control Mechanism," Journal of Risk and Uncertainty, Springer, vol. 31(1), pages 5-21, July.
- Charles A.M. de Bartolome, 2007. "Tax competition and the creation of redundant products," Canadian Journal of Economics, Canadian Economics Association, vol. 40(4), pages 1213-1236, November.
- W. Pesendorfer & F. Gul, 1999.
"Temptation and Self-Control,"
Princeton Economic Theory Papers
99f1, Economics Department, Princeton University.
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- Ian Irvine & William Sims, 2012. "A Taxing Dilemma: Assessing the Impact of Tax and Price Changes on the Tobacco Market," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 350, May.
- Andrew Leicester & Peter Levell, 2013. "Anti-smoking policies and smoker well-being: evidence from Britain," IFS Working Papers W13/13, Institute for Fiscal Studies.
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