Are Cigarette Bans Really Good Economic Policy?
AbstractWe investigate the quarterly relationship between the quantity of cigarettes sold, real disposable income per capita, and the relative price level of cigarettes in Canada. Careful attention is paid to the non-stationarity of the data and the dynamic specification of the model. We conclude that cigarette demand is extremely insensitive to price and income changes. This is evidence of the large consumer surplus smokers enjoy and the large revenue increasing potential of a cigarette tax increase policy, as opposed to cigarette bans.
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Bibliographic InfoPaper provided by Department of Economics, University of Victoria in its series Econometrics Working Papers with number 9903.
Length: 12 pages
Date of creation: 21 May 1999
Date of revision:
Note: ISSN 1485-6441
Contact details of provider:
Postal: PO Box 1700, STN CSC, Victoria, BC, Canada, V8W 2Y2
Web page: http://web.uvic.ca/econ
More information through EDIRC
Cigarettes; exise tax; consumer surplus;
Other versions of this item:
- C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
This paper has been announced in the following NEP Reports:
- NEP-ALL-1999-07-28 (All new papers)
- NEP-ENV-1999-07-28 (Environmental Economics)
- NEP-HEA-1999-07-28 (Health Economics)
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