Tobacco taxes and illicit cigarette trade in Colombia

Juan Gallego (), Blanca Llorente, Norman Maldonado (), Susana Otálvaro-Ramírez and Paul Rodríguez-Lesmes
Authors registered in the RePEc Author Service: Paul Andres Rodriguez Lesmes

Economics & Human Biology, 2020, vol. 39, issue C

Abstract: This paper estimates the short-term impact of a twofold increase of the tobacco excise tax on consumption of illicit cigarette trade in Colombia. Using data collected before and after the tax increase from a novel smoker survey (DEICS-Col), the impact is estimated as the change in the probability that a smoker has illicit cigarettes. The methodology follows a difference-in-differences strategy, measuring the year-to-year variation of the proportion of illicit cigarettes between smokers who report buying low-priced cigarettes (the highest treatment intensity) and those who bought high-priced cigarettes (lowest treatment intensity). Estimations of the impact show an average increase of 4–5 percentage points on the proportion of illicit cigarettes relative to an initial penetration of low-priced illicit cigarettes of nearly 5.1 %.

Keywords: Illicit cigarette trade; Tobacco excise taxes; Tobacco control; Health behaviour (search for similar items in EconPapers)
JEL-codes: H25 H26 I12 O17 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ehbiol:v:39:y:2020:i:c:s1570677x20301726

DOI: 10.1016/j.ehb.2020.100902

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