The Comprehensive Effects of Tobacco Control Policies on Tobacco-Related Purchases

This paper estimates the effects of tobacco control policies on purchases of tobacco-related products.  We use the Nielsen Consumer Panel Survey, which tracks the monthly purchases of approximately 40,000 households between 2004 and 2006, and 60,000 households between 2007 and 2009.  A key strength of our data set is that it allows us to track actual purchases instead of relying on self-reported retrospective information and also control for unobservable, individual-level characteristics through individual-level fixed effects. We use policy changes within counties and states, over time, to estimate the causal effects of these policies on household cigarette, smokeless tobacco, and anti-smoking product purchases.  We find that higher cigarette excise taxes decrease consumers’ purchases of cigarettes. Dual-person households that are homeowners, retired, or poorer, as well as older, unemployed, or poorer single-person households are especially likely to quit smoking. Single-person households as well as home-owning or employed dual-person households that continue to smoke are especially likely to reduce the number of cigarettes purchased.   We also find that increases in bar smoking bans decrease the number of cigarettes purchased among older, unemployed, and poor single-person households.  We also find that higher cigarette excise taxes increase dual households’ purchases of anti-smoking products, with the effects driven by lower-income dual households and homeowners.  Additionally we find that smokeless tobacco taxes increase anti-smoking product purchases for single households, with the effects driving by younger, poorer, unemployed, and retired single-person households.