To Smoke or to Vape: The Role of Flavors, Health Warnings, and Price

The prevalence of cigarette smoking continues to decline, but the use of several products that appear to be close substitutes shows different trends. Among some age groups the use of little cigars, which are nearly the same size as cigarettes, has held steady. The use of e-cigarettes and other vaping products has sharply risen. In recent data, almost half of current cigarette smokers report having tried an e-cigarette and about 16 percent report currently using e-cigarettes.  Cigarettes, little cigars, and e-cigarettes are regulated and taxed differently.

We conduct a discrete choice experiment (DCE) to study the roles policy-manipulable product attributes play in smokers' decisions to purchase cigarettes, little cigars, and e-cigarettes. We recruit subjects from urban and rural socioeconomically disadvantaged populations to participate in an experimental market. We experimentally vary product attributes to correspond to different potential policy scenarios. The 2009 Tobacco Control Act bans flavors other than menthol in combustible cigarettes, but little cigars and and e-cigarettes are currently available in a variety of flavors. We use the DCE results to predict product use under policy counter-factuals where the ban on flavors is extended to  little cigars only, e-cigarettes only, or to both little cigars and e-cigaretttes. We also use the DCE results to predict the impact of new health warnings on e-cigarettes and the impact of higher taxes on little cigars and/or e-cigarettes. We conclude with a discussion of the implications of alternative policy scenarios for public health and social welfare.