Response to Health Information: Evidence from Cigarette Consumption and Intake of Nicotine and Tar in Japan
This paper introduces a new way to examine the effects of mandatory information disclosure on inter-brand cigarette demands and the behavior of a monopolistic firm in Japan. I estimated inter-brand demands by including nicotine, tar content, and policy event information in the model and by using cigarette brand sales data. I found that the mandatory disclosure of nicotine and tar content information decreased the intake of nicotine and tar per capita and per smoker; thus mandatory disclosure is likely to increase consumersf welfare, if we suppose that they always choose their favorite cigarette. Furthermore, I found that the monopolistic firm supplied more, new, and better quality products, discontinued the production of poorer quality goods, and conducted more R & D, in response to disclosure mandates.
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|Date of creation:||Jun 2004|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.econ.osaka-u.ac.jp/|
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