Abstract:
Tobacco control policies have effectively raised the price of cigarettes
and other tobacco products. However, these price increases have been
shown to disproportionately fall upon poorer households, with fewer
resources. In this analysis, we provide an initial indication of the effect
increased prices might have on household allocations, by considering
substitution and complementation related to tobacco consumption.
Our results show substitution between tobacco and most household
consumption items, although elasticities tend to be highest amongst the
poorest households.
