The Behavioral Dynamics of Youth Smoking

43 Pages Posted: 10 Oct 2000 Last revised: 5 Oct 2001

See all articles by Donna B. Gilleskie

Donna B. Gilleskie

University of North Carolina (UNC) at Chapel Hill - Department of Economics

Koleman S. Strumpf

Wake Forest University, Department of Economics

Date Written: August 2000

Abstract

While individual smoking behavior persists over time, it is unknown whether this repeated behavior is due to addiction or individual propensities to smoke. To address this issue, we develop a dynamic empirical model of smoking decisions which explicitly accounts for the impact of previous smoking behavior and allows for unobserved individual heterogeneity. The model is estimated using longitudinal data on a representative sample of teens from all 50 United States from 1988 to 1992. We find that current smokers are both more likely to continue smoking and are less price sensitive than current non-smokers. For example, smoking in 8th grade (as opposed to not smoking) increased the probability of smoking two years later three fold, while smoking participation rates are double four years later. The estimated price sensitivities of previous non-smokers and previous smokers are -0.32 and 0.08, respectively. This suggests that a cigarette price increase will have a larger aggregate effect in the long run than in the short run as more individuals accumulate in the price-sensitive non-smoking group. In total, a dollar increase in cigarette prices reduces (age 18) smoking participation predictions by four percentage points more when unobserved individual heterogeneity and behavior modification associated with previous price changes are taken into account than when they are ignored.

Suggested Citation

Gilleskie, Donna B. and Strumpf, Koleman S., The Behavioral Dynamics of Youth Smoking (August 2000). NBER Working Paper No. w7838, Available at SSRN: https://ssrn.com/abstract=239099

Donna B. Gilleskie (Contact Author)

University of North Carolina (UNC) at Chapel Hill - Department of Economics ( email )

Chapel Hill, NC 27599
United States

Koleman S. Strumpf

Wake Forest University, Department of Economics ( email )

PO Box 7505
Winston-Salem, NC 27109
United States
336-758-5410 (Phone)

HOME PAGE: http://users.wfu.edu/strumpks

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