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Smoke-free laws and bar revenues in California - the last call

  • David W. Cowling

    (Tobacco Control Section, California Department of Health Services, USA)

  • Philip Bond

    (University of Pennsylvania, Wharton Finance Department, Steinberg Hall-Dietrich Hall, USA)

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    California was the first state to implement smoke-free restaurant and bar laws, in 1995 and 1998, respectively. We analyze how these laws affected the distribution of revenues between bars and restaurants. Critics of smoke-free bar laws have often claimed that a prohibition on smoking reduces bar revenues. Similar claims are made for the effects of smoke-free restaurant laws. Such claims implicitly assume that a smoke-free law reduces expenditures by smokers by more than it increases expenditures by non-smokers. Using tax revenue data from 1990 to 2002, our analysis suggests that the actual effect is just the opposite: the 1995 smoke-free restaurant law is associated with an increase in restaurant revenues, while the 1998 smoke-free bar law is associated with an increase in bar revenues. Copyright © 2005 John Wiley & Sons, Ltd.

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    Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

    Volume (Year): 14 (2005)
    Issue (Month): 12 ()
    Pages: 1273-1281

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    Handle: RePEc:wly:hlthec:v:14:y:2005:i:12:p:1273-1281
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