IDEAS home Printed from
   My bibliography  Save this article

The demand for cigarette in Tanzania: A temporal approach


  • Kidane, Asmerom

    (University of Dar es Salaam, Tanzania)

  • Hepelwa, Aloyce

    (University of Dar es Salaam, Tanzania)

  • Mdadila, Kenneth

    (University of Dar es Salaam, Tanzania)

  • Ngeh, Ernest

    (University of Dar es Salaam, Tanzania)

  • Hu, Teh Wei

    (University of California, Berkeley)


The study presented here attempts to estimate the effect of increased price of cigarettes on the corresponding consumption in Tanzania. The study is based on household panel survey data that were conducted over three periods in 2008, 2010 and 2012. For each period price is estimated indirectly. The price increase was substantial and higher than the corresponding aggregate Consumer Price Index (CPI). An attempt is made to relate the increase in price with a possible decrease in cigarette consumption. The methods of analysis are descriptive tabular statistics and the «two-equation econometrics» approach. Over the study period, the descriptive approach showed a substantial increase in price but a modest decrease in cigarette consumption prevalence rate, intensity rate and per capita consumption. When a more robust and powerful econometric method was applied, the results showed a substantial decrease in consumption. There was a significant reduction in intensity compared to participation. Between 2008 and 2010 total price elasticity of demand decreased from –0.686 to –0.727. In 2012 the value was –1.139. The reduction in consumption was much higher among the very poor and the poor (–2.387 and –1.967 respectively). When cross classified by age group the youth (20 years or less) showed a high elasticity of –1.672. The results suggest that in a typical African country smokers (who are relatively poor) will react to substantial price increase in a predictable manner. Price elasticity of demand greater than absolute unity need not be unusual.

Suggested Citation

  • Kidane, Asmerom & Hepelwa, Aloyce & Mdadila, Kenneth & Ngeh, Ernest & Hu, Teh Wei, 2017. "The demand for cigarette in Tanzania: A temporal approach," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 45, pages 136-143.
  • Handle: RePEc:ris:apltrx:0314

    Download full text from publisher

    File URL:
    File Function: Full text
    Download Restriction: no

    References listed on IDEAS

    1. Jha, Prabhat & Chaloupka, Frank (ed.), 2000. "Tobacco Control in Developing Countries," OUP Catalogue, Oxford University Press, number 9780192632463.
    2. Chaloupka, Frank J. & Warner, Kenneth E., 2000. "The economics of smoking," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 29, pages 1539-1627, Elsevier.
    3. C.P. Van Walbeek*, 1996. "Excise Taxes on Tobacco: How Much Scope does the Government Have?," South African Journal of Economics, Economic Society of South Africa, vol. 64(1), pages 12-23, March.
    4. Unknown, 2010. "WHO Technical Manual on Tobacco Tax Administration," University of California at San Francisco, Center for Tobacco Control Research and Education qt8tn2317v, Center for Tobacco Control Research and Education, UC San Francisco.
    5. Cp Van Walbeek, 2002. "The Distributional Impact of Tobacco Excise Increases*(1)," South African Journal of Economics, Economic Society of South Africa, vol. 70(3), pages 258-267, March.
    Full references (including those not matched with items on IDEAS)


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

    Cited by:

    1. Asiya Maskaeva & Zanda Bochkaeva & Joel Mmasa & Mgeni Msafiri, 2022. "The impact of indirect tax on income distribution and poverty in Tanzania," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 93(1), pages 103-128, March.
    2. Asiya Maskaeva & Zanda Bochkaeva & Joel Mmasa & Mgeni Msafiri & Eric Iramba, 2019. "Microsimulation analysis of the impact of indirect tax benefits on income distribution and poverty alleviation in Tanzania: An application of TAZMOD," WIDER Working Paper Series wp-2019-16, World Institute for Development Economic Research (UNU-WIDER).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Budi Hidayat & Hasbullah Thabrany, 2010. "Cigarette Smoking in Indonesia: Examination of a Myopic Model of Addictive Behaviour," IJERPH, MDPI, vol. 7(6), pages 1-13, June.
    2. Hidayat, Budi & Thabrany, Hasbullah, 2010. "Cigarette smoking in Indonesia: examination of a myopic model of addictive behaviour," MPRA Paper 30194, University Library of Munich, Germany, revised 17 May 2010.
    3. G. Guindon, 2014. "The impact of tobacco prices on smoking onset in Vietnam: duration analyses of retrospective data," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 15(1), pages 19-39, January.
    4. Carnazza, Giovanni & Liberati, Paolo & Resce, Giuliano & Molinaro, Sabrina, 2021. "Smoking and income distribution: Inequalities in new and old products," Health Policy, Elsevier, vol. 125(2), pages 261-268.
    5. Fernando S. Machado & Rajiv K. Sinha, 2007. "Smoking Cessation: A Model of Planned vs. Actual Behavior for Time-Inconsistent Consumers," Marketing Science, INFORMS, vol. 26(6), pages 834-850, 11-12.
    6. Halizah Mat Rifin & Miaw Yn Jane Ling & Tania Gayle Robert Lourdes & Thamil Arasu Saminathan & Wan Shakira Rodzlan Hasani & Nur Liana Ab Majid & Hamizatul Akmal Abd Hamid & Mohd Ruhaizie Riyadzi & Ahz, 2022. "Small/Kiddie Cigarette Packaging Size and Its Impact on Smoking: A Systematic Review," IJERPH, MDPI, vol. 19(19), pages 1-23, September.
    7. Recher, Vedran, 2020. "Illegal tobacco demand: The case of Western Balkan," Economic Analysis and Policy, Elsevier, vol. 66(C), pages 182-193.
    8. Salti, Nisreen & Brouwer, Elizabeth & Verguet, Stéphane, 2016. "The health, financial and distributional consequences of increases in the tobacco excise tax among smokers in Lebanon," Social Science & Medicine, Elsevier, vol. 170(C), pages 161-169.
    9. 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.
    10. Martyn Duffy, 2006. "Tobacco consumption and policy in the United Kingdom," Applied Economics, Taylor & Francis Journals, vol. 38(11), pages 1235-1257.
    11. Goel, Rajeev K., 2013. "Where to snuff the puff? Relative effectiveness of U.S. smoking control policies," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 44(C), pages 97-102.
    12. Yi-Chi Chen & Chang-Ching Lin, 2010. "Threshold Effects in Cigarette Addiction: An Application of the Threshold Model in Dynamic Panels," Economics Bulletin, AccessEcon, vol. 30(4), pages 3128-3142.
    13. Jon P. Nelson, 2010. "What is Learned from Longitudinal Studies of Advertising and Youth Drinking and Smoking? A Critical Assessment," IJERPH, MDPI, vol. 7(3), pages 1-57, March.
    14. Li-Ming Ho & Christian Schafferer & Jie-Min Lee & Chun-Yuan Yeh & Chi-Jung Hsieh, 2017. "The effect of cigarette price increases on cigarette consumption, tax revenue, and smoking-related death in Africa from 1999 to 2013," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 62(8), pages 899-909, November.
    15. Saša Ranđelović & Milica Bisić, 2021. "Excise duties harmonisation and smoking in a model with cross-border arbitrage," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 48(2), pages 507-532, May.
    16. Martin Gonzalez-Rozada, 2019. "Increasing Cigarette Taxes is Unfair to the Poor? Evidence from Argentina," Department of Economics Working Papers 2019_01, Universidad Torcuato Di Tella.
    17. Sijbren Cnossen & D. Forrest & S. Smith, 2009. "Taxation and regulation of smoking, drinking and gambling in the European Union," CPB Special Publication 76, CPB Netherlands Bureau for Economic Policy Analysis.
    18. Marko Primorac & Silvija Vlah Jeric, 2017. "The Structure of Cigarette Excises in the EU: From Myths to Reality," CESifo Working Paper Series 6386, CESifo.
    19. Goel, Rajeev K., 2014. "Economic stress and cigarette smoking: Evidence from the United States," Economic Modelling, Elsevier, vol. 40(C), pages 284-289.
    20. Petr David, 2011. "Why and how to tax cigarettes?," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 59(4), pages 43-50.

    More about this item


    cigarette; demand; price; smoking participation; smoking intensity;
    All these keywords.

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:apltrx:0314. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anatoly Peresetsky (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.