EFFECTS OF HEALTH RISK INFORMATION ON ADDICTIVE GOODS CONSUMPTION: A CASE OF TOBACCO, ALCOHOL, AND BETEL NUTS IN TAIWAN

Jie‐min Lee, Sheng‐hung Chen, Hsiang‐hsi Liu, Jung‐yao Hung and Mei‐yun Huang

Contemporary Economic Policy, 2010, vol. 28, issue 3, 406-413

Abstract: This paper empirically investigates the relationship between the dissemination of information about the health risks of tobacco, alcohol, and betel nuts and their consumption in Taiwan. To estimate cross‐elasticities, the paper uses the Central Bureau of Statistics demand system model. Empirical results indicate that an increase in the dissemination of information on the health risks of tobacco, alcohol, and betel nuts substantially reduces real consumption. Empirical evidence from the cross‐elasticity of price also confirms that a complementary relationship exists in Taiwan among these three addictive products. (JEL D12, Q11, H26)

Date: 2010
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