The Effects of Tobacco Control Policies on Tobacco Products, Tar, and Nicotine Purchases among Adults: Evidence from Household Panel Data

Abstract

We analyze the Nielsen Homescan Consumer Panel to estimate the effects of tobacco policies on tobacco-related purchases using within-household variation. We also match purchases to cigarette contents from NHANES. Higher cigarette taxes reduce cigarette purchases and increase smoking cessation product purchases, while estimates of smoking ban effects are less precisely estimated. Smokeless tobacco (SLT) taxes lead to reductions in SLT use but also lead to substitution among SLT products. We find evidence that cigarette taxes induce purchases of cigarettes with higher tar, nicotine, and carbon monoxide contents, but this compensatory behavior is overwhelmed by the reduction in cigarettes purchased.

Keywords: cigarette smoking, cigarette taxes, smokeless tobacco taxes, compensating behavior

JEL Classification: D12, I12, I18