DOES THE US CIGARETTE TAX IMPOSED ON TOBACCO EXPENDITURE WORK
Keywords:
Cigarette Tax, Tobacco ExpenditureAbstract
The cigarette and smoking are the one of the important health and socioeconomic issues in both national and global aspects. The centralized policy such as government policy and education system can influence the people to be healthy and active in self-prevention. The cigarette excise tax is one of the state-level tools to capture the externalities of being smoker. Also, the revision of the effect of cigarette tax on tobacco expenditure should be concerned. Therefore, we deal with the data from the Consumer Expenditure from 2009 to 2011. We find that most of variables are significant with exception of quarterly and yearly dummy variables which do not seem to influence tobacco consumption. The results yield that the tobacco spending of CUs is affected by the cigarette tax significantly. Especially, in 2011, some state had cigarette tax increased, the results indicated that the household decreased the tobacco expenditure significantly. Furthermore, the differences in gender, ethnic group, marital status and region had the unique effect on the tobacco expenditure. Age, education and family size inversed U-shape pattern to tobacco expenditure. Nevertheless, income level progressively increased the tobacco expenditure. Finally, we found that most of explanatory variables and especially cigarette tax can significantly affect the probability of being smoker obviously. This paper considers the policy implications to reduce the cigarette spending by influencing the members of the family to avoid consuming tobacco, increase the cigarette tax to reduce the smoke consumption, communicate the hazardous of smoking and being smoker to the earners of the family to cut the tobacco expenditures, as well as take care of the middle age, middle of education, and the smokers who came from the middle size family whenever starting the government campaign.
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