Cigarette Tax Revenues and Tobacco Control in Japan
The hypotheses of non-addiction, myopia and rational addiction are tested using annual, quarterly and monthly data. Changes in the prices of Japanese cigarettes can be viewed as exogenous from the point of view of consumer behavior, because the Japanese government controls cigarette prices. The empirical results of this paper support the addiction hypothesis. The short-run and long-run price elasticities range from -0.338 to -0.421, and from -0.679 to -0.686, respectively; thus, increases in tax revenues in the long-run are likely to be smaller than those in the short-run. As a result, tax increases would be an effective means of curbing smoking and reducing its social cost. Furthermore, the debt compensation programs for the Japan Railway and the National Forestry will not go according to plan, unless revenues are increased in the future.
|Date of creation:||Jun 2004|
|Date of revision:||Feb 2006|
|Publication status:||Forthcoming in Applied Economics|
|Contact details of provider:|| Web page: http://www.econ.osaka-u.ac.jp/|
More information through EDIRC
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.:
- 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.
- William N. Evans & Matthew C. Farrelly & Edward Montgomery, 1996.
"Do Workplace Smoking Bans Reduce Smoking?,"
NBER Working Papers
5567, National Bureau of Economic Research, Inc.
- Frank J. Chaloupka, 1990.
"Rational Addictive Behavior and Cigarette Smoking,"
NBER Working Papers
3268, National Bureau of Economic Research, Inc.
- Becker, Gary S & Murphy, Kevin M, 1988.
"A Theory of Rational Addiction,"
Journal of Political Economy,
University of Chicago Press, vol. 96(4), pages 675-700, August.
- Gary S. Becker & Kevin M. Murphy, 1986. "A Theory of Rational Addiction," University of Chicago - George G. Stigler Center for Study of Economy and State 41, Chicago - Center for Study of Economy and State.
- Bask, Mikael & Melkersson, Maria, 2001.
"Rationally Addicted to Drinking and Smoking?,"
Umeå Economic Studies
567, Umeå University, Department of Economics.
- 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.
- Jose Julian Escario & Jose Alberto Molina, 2001. "Testing for the rational addiction hypothesis in Spanish tobacco consumption," Applied Economics Letters, Taylor & Francis Journals, vol. 8(4), pages 211-215.
- Christopher Auld & Paul Grootendorst, 2001.
"An Empirical Analysis of Milk Addiction,"
2001-17, Department of Economics, University of Calgary, revised 05 Dec 2001.
- Wu, De-Min, 1973. "Alternative Tests of Independence Between Stochastic Regressors and Disturbances," Econometrica, Econometric Society, vol. 41(4), pages 733-50, July.
- Chee-Ruey Hsieh, 1998. "Health risk and the decision to quit smoking," Applied Economics, Taylor & Francis Journals, vol. 30(6), pages 795-804.
- Rajeev Goel, 2004. "Cigarette demand in Canada and the US-Canadian cigarette smuggling," Applied Economics Letters, Taylor & Francis Journals, vol. 11(9), pages 537-540.
When requesting a correction, please mention this item's handle: RePEc:osk:wpaper:0411r. 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: (Atsuko SUZUKI)
If references are entirely missing, you can add them using this form.