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Restaurant Owners’ Perceptions Of Effects Of A Smoking Ban

  • Hammar, Henrik

    (Department of Economics, School of Economics and Commercial Law, Göteborg University)

The aim of this paper is to analyze business owners’ expected changes in turnover due to a general smoking ban in restaurants, bars and cafés in Sweden. This is accomplished using a survey mailed out to all 642 restaurants, bars, cafés and nightclubs in Gothenburg. The results show that the dependence on smoking customers and the beliefs on how the whole restaurant sector would be affected are in terms of size and statistical significance, the most important variables for explaining expectations of changes in turnover. The econometric results show that the owners are more likely to expect a decrease in turnover the larger the share of smoking customers is. Moreover, owners are less likely to expect financial losses due to a general smoking ban if establishments do not currently allow smoking or have a non-smoking section. No strong effect of the type of establishment on expected changes in turnover is detected, even though establishments with late night hours are more likely to expect financial losses. The study also,tentatively, concludes that many owners do not take general equilibrium effects into account, which may bias their expectations of turnover downwards. Resistance to a general smoking ban is not only explained by an expected loss in turnover, but also by the owners’ attitudes towards customers smoking, property right over air space, and perception of the restaurant sector turnover. Resistance to a smoking ban is also greater among bars/nightclubs and restaurants compared to cafés.

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Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 60.

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Length: 25 pages
Date of creation: 30 Nov 2001
Date of revision:
Handle: RePEc:hhs:gunwpe:0060
Contact details of provider: Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
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  1. Katz, Michael L & Shapiro, Carl, 1986. "Technology Adoption in the Presence of Network Externalities," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 822-41, August.
  2. Hammar, Henrik & Carlsson, Fredrik, 2001. "Smokers' Decisions To Quit Smoking," Working Papers in Economics 59, University of Gothenburg, Department of Economics.
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