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Impact of Non-smoking Ordinances on Hospitality Revenues: The Case of Germany

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Listed:
  • Ahlfeldt Gabriel M.

    () (LSE, Department of Geography & Environment, Houghton Street, London WC2A 2AR, UK)

  • Maennig Wolfgang

    () (University of Hamburg, Department of Economics, Chair for Economic Policy, Von-Melle-Park 5, 20146 Hamburg, Germany)

Abstract

Non-smoking ordinances are among the most popular albeit controversial public health-care legislations worldwide. This article provides an empirical assessment of the impact of nonsmoking ordinances on bar and restaurant revenues in German Federal States. By application of a standard panel regression approach and a quasi-experimental research design, we find no compelling evidence for a significant impact of the introduction as well as the weakening of the legislation on revenues of bars and restaurants. Consumption pattern has either not changed at all or any reduction in spending by smokers is compensated for by a corresponding increase by non-smokers. These findings support the German - and similar - non-smoking legislations in the sense that positive externalities resulting from reduced health care cost are likely to outweigh the risk to businesses in the hospitality sector.

Suggested Citation

  • Ahlfeldt Gabriel M. & Maennig Wolfgang, 2010. "Impact of Non-smoking Ordinances on Hospitality Revenues: The Case of Germany," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 230(5), pages 506-521, October.
  • Handle: RePEc:jns:jbstat:v:230:y:2010:i:5:p:506-521
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    References listed on IDEAS

    as
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    Citations

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    Cited by:

    1. Verardi Vincenzo & Wagner Joachim, 2011. "Robust Estimation of Linear Fixed Effects Panel Data Models with an Application to the Exporter Productivity Premium," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 231(4), pages 546-557, August.
    2. Franziska K. Kruse & Wolfgang Maennig, 2017. "The future development of world records," Working Papers 061, Chair for Economic Policy, University of Hamburg.
    3. Wolfgang Maennig, 2017. "Governance in Sports Organizations," Working Papers 060, Chair for Economic Policy, University of Hamburg.
    4. Harald Tauchmann & Silja Lenz & Till Requate & Christoph Schmidt, 2013. "Tobacco and alcohol: complements or substitutes?," Empirical Economics, Springer, vol. 45(1), pages 539-566, August.
    5. Wolfgang Maennig, 2017. "Public Referenda and Public Opinion on Olympic Games," Working Papers 057, Chair for Economic Policy, University of Hamburg.
    6. Steffen Q. Mueller, 2018. "Pre- and within-season attendance forecasting in Major League Baseball: A random forest approach," Working Papers 065, Chair for Economic Policy, University of Hamburg.
    7. Fischer, Justina AV & Sousa-Poza, Alfonso, 2010. "The impact of institutions on firms’ rejuvenation policies: Early retirement with severance pay versus simple lay-off. A Cross-European Analysis," MPRA Paper 20343, University Library of Munich, Germany.
    8. Michael Kvasnicka & Harald Tauchmann, 2012. "Much ado about nothing? Smoking bans and Germany's hospitality industry," Applied Economics, Taylor & Francis Journals, vol. 44(35), pages 4539-4551, December.
    9. Franziska K. Kruse & Wolfgang Maennig, 2018. "Suspension by choice – determinants and asymmetries," Working Papers 064, Chair for Economic Policy, University of Hamburg.
    10. Michael Kvasnicka & Harald Tauchmann, 2010. "Much Ado About Nothing? – Smoking Bans and Germany’s Hospitality Industry," Ruhr Economic Papers 0172, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    11. Pfeifer, Gregor & Reutter, Mirjam & Strohmaier, Kristina, 2017. "Goodbye smokers' corner: Health effects of school smoking bans," Ruhr Economic Papers 678, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    12. Ahlfeldt Gabriel M. & Maennig Wolfgang, 2010. "Impact of Non-smoking Ordinances on Hospitality Revenues: The Case of Germany," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 230(5), pages 506-521, October.
    13. Gabriel M. Ahlfeldt & Wolfgang Maennig & Felix J. Richter, 2017. "Zoning in reunified Berlin," Working Papers 059, Chair for Economic Policy, University of Hamburg.
    14. repec:zbw:rwirep:0172 is not listed on IDEAS
    15. Wolfgang Maennig, 2017. "Major Sports Events: Economic Impact," Working Papers 058, Chair for Economic Policy, University of Hamburg.
    16. Jaume Garcia Villar & Ángel López-Nicolás, 2014. "Who is afraid of the big bad ban? An evaluation of the effects of the Spanish clean air law on expenditure at hospitality venues," Economics Working Papers 1413, Department of Economics and Business, Universitat Pompeu Fabra, revised Jul 2014.

    More about this item

    Keywords

    Bar and restaurant revenues; non-smoking ordinances; health care legislation;

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law

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