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How increasing tobacco prices affects the decision to start and quit smoking: evidence from Argentina

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Listed:
  • Martin Gonzalez-Rozada
  • Giselle Montamat

Abstract

We study empirically the role of cigarettes’ prices on smoking onset and quitting in Argentina, using a continuous-time split population model. The findings in this paper suggest that increasing cigarettes’ prices, using taxes, has a larger effect on the starting age of smoking than on the quitting age. In particular, at the mean starting age of 15 years an increase of 20% in real cigarettes’ prices is expected to delay smoking onset by 3 years. On the other hand, the same policy is less effective to reduce the duration of the habit because, while negative, the relationship between the duration of the smoking habit and the real price of cigarettes is weak. A policy recommendation that emerges from this evidence is that for people with a developed addiction a combination of an increment in taxes and other public health policies, like cessation therapies, could be implemented to accelerate the time of quitting smoking.

Suggested Citation

  • Martin Gonzalez-Rozada & Giselle Montamat, 2015. "How increasing tobacco prices affects the decision to start and quit smoking: evidence from Argentina," Department of Economics Working Papers 2015_3, Universidad Torcuato Di Tella.
    • Handle: RePEc:udt:wpecon:2015_3
    as

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    References listed on IDEAS

    as
    1. 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.
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    4. Michael P. Kidd & Sandra Hopkins, 2004. "The Hazards of Starting and Quitting Smoking: Some Australian Evidence," The Economic Record, The Economic Society of Australia, vol. 80(249), pages 177-192, June.
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    More about this item

    Keywords

    smoking onset; quitting smoking; split population model; cigarettes’ prices and taxes; survival analysis;
    All these keywords.

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies

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