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Why Take on the Tobacco Industry: the Political Economy of Government Anti-smoking Campaign

The paper shows that government anti-smoking campaign can benefit thegovern-ment in the political bargaining with the tobacco industry by reducing the latter’s alter-native welfare. Although the equilibrium regulation on the tobacco industry increases as a result of government anti-smoking campaign, the political contribution from the tobacco industry will not necessarily go down. Anti-smoking campaign reduces the welfare of the tobacco industry but its potential loss of not lobbying increases. When the incumbent government/politician becomes more hungry for political contribution, it increases its effort in anti-smoking campaign and this could induce more political contribution from the tobacco industry under some plausible conditions.

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File URL: http://www.carleton.ca/economics/wp-content/uploads/cep03-04.pdf
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Paper provided by Carleton University, Department of Economics in its series Carleton Economic Papers with number 03-04.

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Length: 15 pages
Date of creation: 21 May 2003
Date of revision:
Publication status: Published: Carleton Economic Papers
Handle: RePEc:car:carecp:03-04
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  1. Grossman, Gene & Helpman, Elhanan, 1993. "Protection for Sale," CEPR Discussion Papers 827, C.E.P.R. Discussion Papers.
  2. Besley, Timothy J. & Burgess, Robin, 2001. "The Political Economy of Government Responsiveness: Theory and Evidence from India," CEPR Discussion Papers 2721, C.E.P.R. Discussion Papers.
  3. Giovanni Maggi & Andres Rodriguez-Clare, 1998. "The Value of Trade Agreements in the Presence of Political Pressures," Journal of Political Economy, University of Chicago Press, vol. 106(3), pages 574-601, June.
  4. Stromberg, David, 2001. "Mass media and public policy," European Economic Review, Elsevier, vol. 45(4-6), pages 652-663, May.
  5. Dixit, Avinash & Grossman, Gene M. & Helpman, Elhanan, 1997. "Common Agency and Coordination: General Theory and Application to Government Policy Making," Scholarly Articles 3450061, Harvard University Department of Economics.
  6. Lahiri, Sajal & Raimondos-Moller, Pascalis, 2000. "Lobbying by Ethnic Groups and Aid Allocation," Economic Journal, Royal Economic Society, vol. 110(462), pages C62-79, March.
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