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Smoking in Restaurants: Who Best to Set the House Rules?

Author

Listed:
  • David R. Henderson

Abstract

Alamar and Glantz interpret smoking in restaurants as a market failure, and they claim that restaurants should welcome government laws that disallow smoking in all restaurants. Contrary to their claims, restaurant owners do have an incentive to eliminate smoking if doing so raises the value of their restaurants. In restaurants, smokers do not impose negative externalities on non-smokers because restaurant owners have well-defined property rights that cause them to internalize the costs and benefits of smoking. Alamar and Glantz claim to show that non-smoking ordinances increase the capital value of restaurants, but their own data do not, in fact, show that. Finally, if it were true that eliminating smoking in restaurants raises the value of restaurants, then the proper approach would be, not to coerce restaurant owners, but to inform them of that fact.

Suggested Citation

  • David R. Henderson, 2007. "Smoking in Restaurants: Who Best to Set the House Rules?," Econ Journal Watch, Econ Journal Watch, vol. 4(3), pages 284-291, September.
  • Handle: RePEc:ejw:journl:v:4:y:2007:i:3:p:284-291
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    File URL: https://econjwatch.org/file_download/164/2007-09-henderson-com.pdf?mimetype=pdf
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    File URL: https://econjwatch.org/247
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    References listed on IDEAS

    as
    1. Benjamin C. Alamar & Stanton A. Glantz, 2004. "Smoke-free Ordinances Increase Restaurant Profit and Value," Contemporary Economic Policy, Western Economic Association International, vol. 22(4), pages 520-525, October.
    2. Alamar, B C & Glantz, Stanton A. Ph.D., 2004. "Smoke-free ordinances increase restaurant profit and value," University of California at San Francisco, Center for Tobacco Control Research and Education qt91w950j4, Center for Tobacco Control Research and Education, UC San Francisco.
    3. J. Dunham & ML. Marlow, 2000. "Smoking laws and their differential effects on restaurants, bars, and taverns," Contemporary Economic Policy, Western Economic Association International, vol. 18(3), pages 326-333, July.
    4. Jeff DeSimone & Edward J. Schumacher, 2004. "Compensating Wage Differentials and AIDS Risk," NBER Working Papers 10861, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Who Owns the "Right to Recline?" The Airline, by David Henderson
      by ? in Econlog on 2014-08-28 21:45:57

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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    Cited by:

    1. Benjamin C. Alamar & Stanton A. Glantz, 2008. "Externalities in the Workplace: A Response to a Rejoinder to a Response to a Response to a Paper," Econ Journal Watch, Econ Journal Watch, vol. 5(2), pages 169-173, May.
    2. Annette Hofmann & Martin Nell, 2012. "Smoking bans and the secondhand smoking problem: an economic analysis," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 13(3), pages 227-236, June.

    More about this item

    Keywords

    Smoking; smoke-free; externalities; restaurants;

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • J83 - Labor and Demographic Economics - - Labor Standards - - - Workers' Rights
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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