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

Kilts Center for Marketing at Chicago Booth – Nielsen Dataset Paper Series 1-045

63 Pages Posted: 4 Mar 2015 Last revised: 28 Aug 2016

See all articles by Chad D. Cotti

Chad D. Cotti

University of Wisconsin - Oshkosh

Erik Nesson

Ball State University - Department of Economics

Nathan Tefft

Bates College

Date Written: February 5, 2016

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

Suggested Citation

Cotti, Chad D. and Nesson, Erik and Tefft, Nathan, The Effects of Tobacco Control Policies on Tobacco Products, Tar, and Nicotine Purchases among Adults: Evidence from Household Panel Data (February 5, 2016). Kilts Center for Marketing at Chicago Booth – Nielsen Dataset Paper Series 1-045, Available at SSRN: https://ssrn.com/abstract=2572888 or http://dx.doi.org/10.2139/ssrn.2572888

Chad D. Cotti

University of Wisconsin - Oshkosh ( email )

800 Algoma Blvd
Oshkosh, WI WI 54901
United States

Erik Nesson (Contact Author)

Ball State University - Department of Economics ( email )

Muncie, IN 47306-0340
United States

Nathan Tefft

Bates College ( email )

Lewiston, ME 04240
United States

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