Cigarettes and addiction information: simulating the demand effects of the tobacco industry's 'conspiracy of silence'
Although cigarette manufacturers were aware of the addictive properties of nicotine as early as 1962, the information did not become available to the US public until 1979 when the Surgeon General disclosed it (US Department of Health, Education, and Welfare, 1979). This study simulates the impact this information would have had on the demand for cigarettes had it been released in 1962. The simulations build on past work by Fenn et al. (2001) who found evidence that the release of addiction information resulted in a structural shift in demand in 1979. In the present study, the econometric results from Fenn et al. (2001) are used to compute simulated time paths for state-level per capita consumption under the hypothetical scenario involving the earlier release of the addiction information. Using these simulated consumption paths; the projected reductions in cigarette sales revenue are calculated. These dollar figures provide a benchmark against which to judge the compensation amounts that the industry must pay because of recent tobacco lawsuit settlements.
Volume (Year): 36 (2004)
Issue (Month): 19 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/RAEC20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RAEC20|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Becker, Gary S & Grossman, Michael & Murphy, Kevin M, 1994.
"An Empirical Analysis of Cigarette Addiction,"
American Economic Review,
American Economic Association, vol. 84(3), pages 396-418, June.
- Gary S. Becker & Michael Grossman & Kevin M. Murphy, 1990. "An Empirical Analysis of Cigarette Addiction," University of Chicago - George G. Stigler Center for Study of Economy and State 61, Chicago - Center for Study of Economy and State.
- Gary S. Becker & Michael Grossman & Kevin M. Murphy, 1990. "An Empirical Analysis of Cigarette Addiction," NBER Working Papers 3322, National Bureau of Economic Research, Inc.
- Auld, M. Christopher & Grootendorst, Paul, 2004.
"An empirical analysis of milk addiction,"
Journal of Health Economics,
Elsevier, vol. 23(6), pages 1117-1133, November.
- Baltagi, Badi H & Levin, Dan, 1986. "Estimating Dynamic Demand for Cigarettes Using Panel Data: The Effects of Bootlegging, Taxation and Advertising Reconsidered," The Review of Economics and Statistics, MIT Press, vol. 68(1), pages 148-55, February.
- Fenn, Aju J. & Antonovitz, Frances & Schroeter, John R., 2001.
"Cigarettes and addiction information: new evidence in support of the rational addiction model,"
Elsevier, vol. 72(1), pages 39-45, July.
- Fenn, Aju J. & Antonovitz, Frances A. & Schroeter, John R., 2001. "Cigarettes and Addiction Information: New Evidence in Support of the Rational Addiction Model," Staff General Research Papers 5117, Iowa State University, Department of Economics.
- Baltagi, Badi H & Griffin, James M, 2001. "The Econometrics of Rational Addiction: The Case of Cigarettes," Journal of Business & Economic Statistics, American Statistical Association, vol. 19(4), pages 449-54, October.
- Blaine, Thomas W. & Reed, Michael R., 1994. "U.S. Cigarette Smoking And Health Warnings: New Evidence From Post World War Ii Data," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 26(02), December.
- Barnett, Paul G. & Keeler, Theodore E. & Hu, Teh-wei, 1995. "Oligopoly structure and the incidence of cigarette excise taxes," Journal of Public Economics, Elsevier, vol. 57(3), pages 457-470, July.
- Gallet, Craig & Agarwal, Rajshree, 1999. "The Gradual Response of Cigarette Demand to Health Information," Bulletin of Economic Research, Wiley Blackwell, vol. 51(3), pages 259-65, July.
When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:36:y:2004:i:19:p:2151-2159. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If references are entirely missing, you can add them using this form.