Working Paper: NBER ID: w21790
Authors: Donald Kenkel; Alan Mathios; Hua Wang
Abstract: The FDA is considering using its regulatory authority over the tobacco industry to promote public health by restricting the advertising of menthol cigarettes. In this paper we contribute new empirical evidence on the effects of magazine advertisements for menthol cigarettes on cigarette demand. Unlike previous research on cigarette advertising and demand, we use individual-level data and a measure of advertising exposure based on each consumer’s magazine-reading habits. These data allow us to control for individual heterogeneity that influences both advertising exposure and cigarette demand. We exploit quasi-experimental variation in advertising exposure in the 2000s created by sharply different supply-side variation in menthol and non-menthol advertising. We examine the importance of controlling for heterogeneity by estimating simple models relating advertising exposure to behavior and then adding specifications that take advantage of the richness of our individual-level data. We examine advertising effects on multiple margins of cigarette demand. Our empirical results do not provide any evidence that menthol advertising in magazines affects cigarette demand at various margins: the probability of menthol use; smoking participation; the number of cigarettes smoked per day; the probability of a past-year quit attempt; and anti-smoking attitudes among teens.
Keywords: menthol cigarettes; advertising; cigarette demand
JEL Codes: I12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Exposure to menthol advertisements (M38) | Probability of menthol use among smokers (C25) |
| Exposure to menthol advertisements (M38) | Smoking participation (I12) |
| Exposure to menthol advertisements (M38) | Number of cigarettes smoked per day (Y10) |
| Exposure to menthol advertisements (M38) | Probability of a past-year quit attempt (C25) |
| Antismoking sentiment among teens (I12) | Exposure to menthol advertisements (M38) |
| Cigarette advertising (M38) | Market expansion (F69) |