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The effect of taxation and regulation on cigarette smoking: Fresh evidence from Turkey

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  • Cetin, Tamer

Abstract

Enacting Law No 5247 in May 2008, Turkey has initiated crucial anti-tobacco policies in the last decade. This paper aims to reveal on the effect of anti-tobacco policies such as excise taxes and regulations on cigarette smoking. To this aim, I empirically investigate the long-term dynamics of demand for cigarettes in Turkey through the OLS estimation strategy under various scenarios and models. Using monthly and quarterly data that cover the pre- and post- anti-smoking policy periods, I estimate demand elasticities and compare the pre- and post- taxation and regulation terms. The results presented in the paper confirm that taxation and regulation have affected the long-term dynamics of demand for cigarettes. The price and income elasticities of demand for cigarettes are significantly higher than the previous literature on Turkey. Demand elasticities have increased on average in the anti-tobacco policies period.

Suggested Citation

  • Cetin, Tamer, 2017. "The effect of taxation and regulation on cigarette smoking: Fresh evidence from Turkey," Health Policy, Elsevier, vol. 121(12), pages 1288-1295.
  • Handle: RePEc:eee:hepoli:v:121:y:2017:i:12:p:1288-1295
    DOI: 10.1016/j.healthpol.2017.09.015
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    References listed on IDEAS

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    1. Onder, Zeynep, 2002. "THE ECONOMICS OF TOBACCO IN TURKEY : New evidence and demand estimates," University of California at San Francisco, Center for Tobacco Control Research and Education qt2n93w0ph, Center for Tobacco Control Research and Education, UC San Francisco.
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    3. Leu, Robert E., 1984. "Anti-smoking publicity, taxation, and the demand for cigarettes," Journal of Health Economics, Elsevier, vol. 3(2), pages 101-116, August.
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    5. Lance, Peter M. & Akin, John S. & Dow, William H. & Loh, Chung-Ping, 2004. "Is cigarette smoking in poorer nations highly sensitive to price?: Evidence from Russia and China," Journal of Health Economics, Elsevier, vol. 23(1), pages 173-189, January.
    6. Gruber, Jonathan & Sen, Anindya & Stabile, Mark, 2003. "Estimating price elasticities when there is smuggling: the sensitivity of smoking to price in Canada," Journal of Health Economics, Elsevier, vol. 22(5), pages 821-842, September.
    7. Jason Abrevaya & Laura Puzzello, 2012. "Taxes, Cigarette Consumption, and Smoking Intensity: Comment," American Economic Review, American Economic Association, vol. 102(4), pages 1751-1763, June.
    8. Wasserman, Jeffrey & Manning, Willard G. & Newhouse, Joseph P. & Winkler, John D., 1991. "The effects of excise taxes and regulations on cigarette smoking," Journal of Health Economics, Elsevier, vol. 10(1), pages 43-64, May.
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    More about this item

    Keywords

    Tobacco industry; Taxation; Public policy;

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law

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