Working Paper: NBER ID: w26017
Authors: Michael F. Pesko; Charles J. Courtemanche; Johanna Catherine Maclean
Abstract: We study the effects of traditional cigarette tax rate changes and e-cigarette tax adoption on use of these products among U.S. adults. Data are drawn from the Behavioral Risk Factor Surveillance System and National Health Interview Survey data over the period 2011 to 2017. Using a differences-in-differences model, we find that higher traditional cigarette taxes reduce adult traditional cigarette use and increase adult e-cigarette use, suggesting that the products are economic substitutes. E-cigarette tax adoption reduces e-cigarette use, with some heterogeneity across groups, and dilutes the own-tax responsiveness of traditional cigarettes.
Keywords: Cigarette Taxes; Ecigarette Taxes; Tobacco Use; Public Health
JEL Codes: H21; I12; I18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Traditional cigarette taxes (H29) | Adult traditional cigarette use (I12) |
| Traditional cigarette taxes (H29) | Everyday smoking (I12) |
| Traditional cigarette taxes (H29) | Adult ecigarette use (I12) |
| Ecigarette tax adoption (H26) | Ecigarette use (L96) |
| Ecigarette tax adoption (H26) | Ecigarette use (BRFSS data) (Y10) |
| Ecigarette tax introduction (H26) | Own-tax elasticity of traditional cigarettes (H29) |