Effect of Indoor Smoking Ban on Health Outcome and Willingness to Pay

Recent interest and discussion in indoor smoking bans has centered upon their role in reducing the source of second-hand smoking among restaurant customers and hospitality workers. Underlying this interest is the empirical proven mechanisms that smoking increases health-related risks such as respiratory and heart conditions, as well as birth defects. Statewide public smoking bans have been enacted recently in the 2 eastern states of Maryland and North Carolina, yet not much is known about their effects on health outcomes. Compare with the adjacent states, Virginia and Kentucky, which do not have statewide indoor smoking bans, we are able to implement a difference-in-differences model to examine the impact of smoking bans on all the smoking related health outcomes, which allows us to examine a more comprehensive effect of the indoor smoking bans on environmental tobacco consumption and health outcomes. Data we use in this study is the NIS from HCUP, which is a nationwide inpatient sample data, contains all the diagnoses that lead to an admission to the hospital.

Primary results show that the smoke ban policy decreased the number of admissions for Carcinoma in situ Respiratory System, Emphysema, and Chronic Airway Obstruction significantly in the treated states after the indoor smoking bans took into effect. However, when measured on intensive margins, the results shows that enacting the smoking ban will likely to decrease the probability of asthma and other respiratory conditions such as bronchitis. The estimate on the heterogeneity of the effect in the sub-samples shows that young adults aged under 18 benefit more from this policy than adults. The welfare analysis shows that the super lower bound of the social willingness to pay for this policy is about $988.56.