EconPapers    
Economics at your fingertips  
 

The Compensating Behavior of Smokers: Taxes, Tar, and Nicotine

William Evans and Matthew C. Farrelly

RAND Journal of Economics, 1998, vol. 29, issue 3, 578-595

Abstract: Using data from the 1979 and 1987 National Health Interview Survey (NHIS), we test whether smokers alter their smoking habits in the face of higher taxes. Smokers in high-tax states are more likely to smoke cigarettes higher in tar and nicotine. Although taxes reduce the number of cigarettes consumed per day among remaining smokers, total daily tar and nicotine intake is unaffected. Young smokers, aged 18-24, are much more responsive to changes in taxes than are older smokers, and their total daily tar and nicotine intake actually increases after a tax hike. We illustrate that tax-induced compensating behavior may eliminate some health benefits generated by reduced smoking participation. A more appropriate tax might be based on the tar and nicotine content of cigarettes.

Date: 1998
References: Add references at CitEc
Citations: View citations in EconPapers (42) Track citations by RSS feed

Downloads: (external link)
http://links.jstor.org/sici?sici=0741-6261%2819982 ... O%3B2-J&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rje:randje:v:29:y:1998:i:autumn:p:578-595

Ordering information: This journal article can be ordered from
https://editorialexp ... i-bin/rje_online.cgi

Access Statistics for this article

More articles in RAND Journal of Economics from The RAND Corporation
Bibliographic data for series maintained by ().

 
Page updated 2019-07-22
Handle: RePEc:rje:randje:v:29:y:1998:i:autumn:p:578-595