Rising Cigarette Prices and Rising Obesity: Coincidence or Unintended Consequence?
40 Pages Posted: 25 May 2007 Last revised: 7 Jul 2008
Date Written: May 23, 2008
Abstract
Economists have begun to debate if the rise in cigarette prices in the U.S. in recent decades has contributed to the nation's rise in obesity, reaching conclusions that are surprisingly sensitive to specification. I show that allowing for the effect to occur gradually over several years leads to the conclusion that a rise in cigarette prices is actually associated with a long-run reduction in body mass index and obesity. This result is robust to the different ethodologies used in the literature. I also provide evidence that indirect effects on exercise and food consumption may explain the counterintuitive result. I hypothesize that people who quit smoking experience a renewed interest in their health, increased confidence in their self-control, and a replenished stock of willpower, causing them to make healthier decisions in other areas as well.
Keywords: cigarettes, smoking, cigarette prices, cigarette taxes, obesity, body weight
JEL Classification: I10
Suggested Citation: Suggested Citation
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