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Toxic Choices: The Theory and Impact of Smoking Bans

Listed author(s):
  • Ian J. Irvine

    (Department of Economics, Concordia University, Montreal, Canada)

  • Van Hai Nguyen

    (Department of Economics, Concordia University, Montreal, Canada)

Smoking bans in the workplace and public places are now ubiquitous. While indices of such controls are commonly included in econometric models, there exists little theory that validates or analyzes them. This paper first proposes a theoretical model of maximizing behaviour on the part of smokers which serves as a vehicle to evaluate bans. It is a type of nicotine inventory management model where smoking during one phase of the day impacts utility in other periods. It also includes an intensity choice as part of the optimization. Calibrated model simulations suggest that, with the exception of heavy smokers, workplace bans have relatively minor impacts on smokers throughout most of the distribution due to substitution possibilities. We estimate quantile regressions using Canadian survey data for 2003 and .find that workplace bans have a surprisingly small impact on the number of cigarettes smoked. However, restrictions on smoking in the home are found to be of an order of importance greater, even when instrumented. The policy conclusion is that the effectiveness of workplace bans depends heavily upon whether there exist complementary restrictions on smoking in environments to which individuals may wish to switch their smoking following a workplace ban.

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File URL: http://www.ucd.ie/geary/static/publications/workingpapers/gearywp200951.pdf
File Function: First version, 2009
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Paper provided by Geary Institute, University College Dublin in its series Working Papers with number 200951.

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Length: 45 pages
Date of creation: 01 Oct 2009
Handle: RePEc:ucd:wpaper:200951
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  1. William N. Evans & Matthew C. Farrelly, 1998. "The Compensating Behavior of Smokers: Taxes, Tar, and Nicotine," RAND Journal of Economics, The RAND Corporation, vol. 29(3), pages 578-595, Autumn.
  2. Philip DeCicca & Donald Kenkel & Alan Mathios & Yoon-Jeong Shin & Jae-Young Lim, 2008. "Youth smoking, cigarette prices, and anti-smoking sentiment," Health Economics, John Wiley & Sons, Ltd., vol. 17(6), pages 733-749.
  3. Becker, Gary S & Grossman, Michael & Murphy, Kevin M, 1994. "An Empirical Analysis of Cigarette Addiction," American Economic Review, American Economic Association, vol. 84(3), pages 396-418, June.
  4. 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.
  5. Gruber, Jonathan & Koszegi, Botond, 2004. "Tax incidence when individuals are time-inconsistent: the case of cigarette excise taxes," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 1959-1987, August.
  6. B. Douglas Bernheim & Antonio Rangel, 2004. "Addiction and Cue-Triggered Decision Processes," American Economic Review, American Economic Association, vol. 94(5), pages 1558-1590, December.
  7. Matthew C. Farrelly & William N. Evans & Edward Montgomery, 1999. "Do Workplace Smoking Bans Reduce Smoking?," American Economic Review, American Economic Association, vol. 89(4), pages 728-747, September.
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