Quantile-Regression Estimates of Cigarette Demand Elasticities for the United States

Journal of Economics and Finance, vol. 28, no. 3, pp. 413-421

Posted: 6 Apr 2016

See all articles by Rajeev K. Goel

Rajeev K. Goel

Illinois State University - Department of Economics

Rati Ram

Illinois State University - Department of Economics

Date Written: 2004

Abstract

Using a simple model and state-level cross-section U.S. data from 1993 to 1999, quantile-regression estimates of price elasticity and income elasticity for cigarette demand are obtained. It is noted that price elasticity shows a sizable variation across the high and low quantity-quartiles. There is a similar variability in the income elasticity, but most of these estimates lack statistical significance. Besides providing an indication of the variation in the price (and income) elasticity for different consumption levels, the exercise suggests some interpretative caution in regard to estimates from constant-elasticity models.

Suggested Citation

Goel, Rajeev K. and Ram, Rati, Quantile-Regression Estimates of Cigarette Demand Elasticities for the United States (2004). Journal of Economics and Finance, vol. 28, no. 3, pp. 413-421. Available at SSRN: https://ssrn.com/abstract=2758970

Rajeev K. Goel (Contact Author)

Illinois State University - Department of Economics ( email )

Normal, IL 61790-4200
United States

Rati Ram

Illinois State University - Department of Economics ( email )

Normal, IL 61790-4200
United States
309-438-7101 (Phone)
309-438-5228 (Fax)

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