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Tobacco Use as Response to Economic Insecurity: Evidence from the National Longitudinal Survey of Youth

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  • Barnes Michael G

    () (Hartford Life)

  • Smith Trenton G.

    () (Washington State University)

Abstract

Emerging evidence from neuroscience and clinical research suggests a novel hypothesis about tobacco use: consumers may choose to smoke, in part, as a "self-medicating" response to the presence of economic insecurity. To test this hypothesis, we examine the effect of economic insecurity (roughly, the risk of catastrophic income loss) on the smoking behavior of a sample of male working-age smokers from the 1979 National Longitudinal Survey of Youth (NLSY79). Using instrumental variables to control for unobserved heterogeneity, we find that economic insecurity has a large and statistically significant positive effect on the decision to continue or resume smoking. Our results indicate, for example, that a 1 percent increase in the probability of becoming unemployed causes an individual to be 2.4 percent more likely to continue smoking. We find that the explanatory power of economic insecurity in predicting tobacco use is comparable to (but distinct from) household income, a more commonly used metric.

Suggested Citation

  • Barnes Michael G & Smith Trenton G., 2009. "Tobacco Use as Response to Economic Insecurity: Evidence from the National Longitudinal Survey of Youth," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 9(1), pages 1-29, November.
  • Handle: RePEc:bpj:bejeap:v:9:y:2009:i:1:n:47
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    References listed on IDEAS

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    Cited by:

    1. Pesko, Michael F. & Baum, Christopher F., 2016. "The self-medication hypothesis: Evidence from terrorism and cigarette accessibility," Economics & Human Biology, Elsevier, vol. 22(C), pages 94-102.
    2. Rohde, Nicholas & Tang, Kam Ki & Osberg, Lars & Rao, D.S. Prasada, 2017. "Is it vulnerability or economic insecurity that matters for health?," Journal of Economic Behavior & Organization, Elsevier, vol. 134(C), pages 307-319.
    3. Rohde, Nicholas & Tang, K.K. & Osberg, Lars & Rao, Prasada, 2016. "The effect of economic insecurity on mental health: Recent evidence from Australian panel data," Social Science & Medicine, Elsevier, vol. 151(C), pages 250-258.
    4. Thorhildur Ólafsdóttir & Birgir Hrafnkelsson & Tinna Ásgeirsdóttir, 2015. "The Icelandic economic collapse, smoking, and the role of labor-market changes," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 16(4), pages 391-405, May.
    5. repec:eme:reinzz:s1049-258520150000023004 is not listed on IDEAS
    6. Trenton Smith, 2009. "Reconciling psychology with economics: Obesity, behavioral biology, and rational overeating," Journal of Bioeconomics, Springer, vol. 11(3), pages 249-282, December.
    7. Roelfs, David J. & Shor, Eran & Davidson, Karina W. & Schwartz, Joseph E., 2011. "Losing life and livelihood: A systematic review and meta-analysis of unemployment and all-cause mortality," Social Science & Medicine, Elsevier, vol. 72(6), pages 840-854, March.
    8. Marina Romaguera de la Cruz, 2017. "Economic insecurity in Spain: A multidimensional analysis," Working Papers 448, ECINEQ, Society for the Study of Economic Inequality.
    9. Goel, Rajeev K., 2014. "Economic stress and cigarette smoking: Evidence from the United States," Economic Modelling, Elsevier, vol. 40(C), pages 284-289.
    10. Chen, Yu-Fu & Petrie, Dennis, 2012. "When to Quit Under Uncertainty? A real options approach to smoking cessation," SIRE Discussion Papers 2012-79, Scottish Institute for Research in Economics (SIRE).
    11. Staudigel, Matthias, 2016. "A soft pillow for hard times? Economic insecurity, food intake and body weight in Russia," Journal of Health Economics, Elsevier, vol. 50(C), pages 198-212.
    12. Tinna Laufey Ásgeirsdóttir & Hope Corman & Kelly Noonan & Þórhildur Ólafsdóttir & Nancy E. Reichman, 2012. "Are Recessions Good for Your Health Behaviors? Impacts of the Economic Crisis in Iceland," NBER Working Papers 18233, National Bureau of Economic Research, Inc.
    13. Ásgeirsdóttir, Tinna Laufey & Corman, Hope & Noonan, Kelly & Ólafsdóttir, Þórhildur & Reichman, Nancy E., 2014. "Was the economic crisis of 2008 good for Icelanders? Impact on health behaviors," Economics & Human Biology, Elsevier, vol. 13(C), pages 1-19.
    14. Irina Grafova, 2011. "Financial Strain and Smoking," Journal of Family and Economic Issues, Springer, vol. 32(2), pages 327-340, June.
    15. Olga Cantó & David O. Ruiz, 2015. "The Contribution of Income Mobility to Economic Insecurity in the US and Spain during the Great Recession," Research on Economic Inequality,in: Measurement of Poverty, Deprivation, and Economic Mobility, volume 23, pages 109-152 Emerald Publishing Ltd.
    16. Xin Xu & Robert Kaestner, 2010. "The Business Cycle and Health Behaviors," NBER Working Papers 15737, National Bureau of Economic Research, Inc.
    17. Xu, Xin, 2013. "The business cycle and health behaviors," Social Science & Medicine, Elsevier, vol. 77(C), pages 126-136.

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