The Effects of Increases in Cigarette Prices on Cigarette Consumption Among Smokers After the Master Settlement Agreement
Document Type
Article
Publication Date
3-2015
Abstract
This paper examines the impact of the large increases in cigarette prices after the Master Settlement Agreement on cigarette consumption among smokers by estimating a dynamic panel data model. I use system generalized method of moments estimator with fixed effects to address the unobserved heterogeneity and the initial conditions problem. I find that older smokers (aged 51 and older) are virtually unresponsive to price changes, and younger smokers (aged 50 and younger) are more price sensitive; women smokers might be more price responsive; and the overall estimated price elasticity for the full sample of smokers is −0.26. In addition, smoke-free air laws do not show significant effects.
DOI
https://doi.org/10.1007/s11150-015-9290-0
Recommended Citation
Ma, Zhen. "The effects of increases in cigarette prices on cigarette consumption among smokers after the Master Settlement Agreement." Review of Economics of the Household 15, no. 4 (December 2017): 1177-1190. https://doi.org/10.1007/s11150-015-9290-0. Please note that the Publication Information provides general citation information and may not be appropriate for your discipline. To receive help in creating a citation based on your discipline, please visit http://libguides.misericordia.edu/citationguide.