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The effect of cigarette price increases on cigarette consumption, tax revenue, and smoking-related death in Africa from 1999 to 2013

Author

Listed:
  • Li-Ming Ho

    (National Kaohsiung Marine University)

  • Christian Schafferer

    (Overseas Chinese University)

  • Jie-Min Lee

    (National Kaohsiung Marine University)

  • Chun-Yuan Yeh

    (Overseas Chinese University)

  • Chi-Jung Hsieh

    (National Changhua University of Education)

Abstract

Objectives This study investigates the effects of price hikes on cigarette consumption, tobacco tax revenues, and reduction in smoking-caused mortality in 36 African countries. Methods Using panel data from the 1999–2013 Euromonitor International, the World Bank and the World Health Organization, we applied fixed-effects and random-effects regression models of panel data to estimate the elasticity of cigarette prices and simulate the effect of price fluctuations. Results Cigarette price elasticity was the highest for low-income countries and considerably lower for other African economies. The administered simulation shows that with an average annual cigarette price increase of 7.38%, the average annual cigarette consumption would decrease by 3.84%, and the average annual tobacco tax revenue would increase by 19.39%. By 2050, the number of averted smoking-attributable deaths (SADs) will be the highest in South Africa, followed by the Democratic Republic of Congo, Madagascar, and Ethiopia. Conclusions Excise tax increases have a significant effect on the reduction of smoking prevalence and the number of averted smoking-attributable deaths, Low-income countries are most affected by high taxation policies.

Suggested Citation

  • 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.
  • Handle: RePEc:spr:ijphth:v:62:y:2017:i:8:d:10.1007_s00038-017-0980-7
    DOI: 10.1007/s00038-017-0980-7
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    References listed on IDEAS

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    1. Samuel Asare & Michal Stoklosa & Jeffrey Drope & Aidan Larsen, 2019. "Effects of Prices on Youth Cigarette Smoking and Tobacco Use Initiation in Ghana and Nigeria," IJERPH, MDPI, vol. 16(17), pages 1-14, August.
    2. Mustapha Immurana & Micheal Kofi Boachie & Maxwell Ayindenaba Dalaba & Kofi Mintah Oware & Toby Joseph Mathew K.K. & Martin Amogre Ayanore & Hadrat Mohammed Yusif, 2021. "An empirical analysis of the effect of tobacco taxation on economic growth in 38 African countries," Journal of International Development, John Wiley & Sons, Ltd., vol. 33(8), pages 1257-1269, November.
    3. Mustapha Immurana & Abdul-Aziz Iddrisu & Micheal Kofi Boachie, 2021. "Does taxation on harmful products influence population health? Evidence from Africa using the dynamic panel system GMM approach," Quality & Quantity: International Journal of Methodology, Springer, vol. 55(3), pages 1091-1103, June.

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