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Economic Issues Related to Tobacco Smoking

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Objectives

The aim of this chapter is to give an overview on the economic aspects related to tobacco smoking, including production and supply of tobacco products.

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Notes

  1. 1.

     According to WHO Tobacco Atlas, in 2000, tobacco farming was present in more than 125 countries and cultivated land measured over four million hectares.

  2. 2.

     To have a global outlook, we propose in Appendix the data for 2010, 2000, and 1990 of FAO concerning hectares of land use, yield and tons produced, together with the rates of increase/decrease in the decades. Pay attention, because the rates of growth and decline, being calculated on specific years and not as averages, may reflect unusual high/low yields due to peculiar climate conditions.

  3. 3.

     See Appendix.

  4. 4.

     In the same study, it is reported that for Yunnan county of China (Jiang et al. 2004) the ratio was lower among all the crops, scoring only 0.99, compared to 4 for mulberry and silkworm, 2 for fruits, 1.99 for rice and wheat, and 1.7 for vegetable oil. For India (Chari 1992) the same may be true: the revenue-to-cost ratio was 4.01 for sunflower, 1.33 for mustard, and only 1.2 for flue-cured tobacco leaf. Finally, the already cited Acop study shows that, according to which cost definition is chosen, the price can cover costs or not (not fully covered are the imputed costs of family workers).

  5. 5.

     The values, taken at the beginning of May are: 2008, 50.83; 2009, 36.28; 2010, 49.32; 2011, 69.81; 2012, 89.31.

  6. 6.

     Among them imidacloprid, chlorpyrifos, 1,3-dichloropropene, aldicarb, dithane DF, and methyl bromide.

  7. 7.

     A review of adverse environmental effects of tobacco farming is found in Lecours et al. 2010.

  8. 8.

     Though, as we see later, production may release nicotine in the environment, being polluting.

  9. 9.

     For a good synthesis look at Chaloupka and Warner 2000.

  10. 10.

     According to Kostova et al. 2011, the elasticity for young estimated with a two part model is very high: the estimated price elasticity of smoking participation is −0.74, and the estimated price elasticity of conditional cigarette demand is approximately −1.37. The total price elasticity of cigarette demand is −2.11 implying that an increase in price of 10% would reduce youth cigarette consumption by 21.1% at the mean.

  11. 11.

     For a different view, see Tenn et al. 2010.

  12. 12.

     This reflects, as we shall see later on, a concern for other goals, sometimes pushed by specific groups of interest, different from public health or public revenue raising, equity being the official motivation for such differentiation.

  13. 13.

     Following Joossens and Raw (2012) smuggling is changing in nature: the issue is shifting from pure smuggling to: “illegal manufacturing, including counterfeiting and the emergence of new cigarette brands, produced in a rather open manner at well known locations, which are only or mainly intended for the illegal market of another country.”

  14. 14.

     All the issues about the costs of smoking are dealt with in the paragraph about costs of smoking and caring for smoking related illnesses.

  15. 15.

     Though other researchers add to these costs the advantages of less healthcare consumption and less social security benefits paid due to earlier death.

  16. 16.

     Often overlooked are the issues of costs on child of mother’s smoke (low-birth weight children), of intangible costs, of costs of cigarettes’ ignited fires, of environmental smoke, of smoke as a complicance for other illnesses, of industry costs for smoking-related maintenance, of increased laundering and hygiene consumption of individuals, and of the costs of butts disposal.

  17. 17.

     The discussion is centered on the “internal” nature of families such that mother’s smoke affecting child cannot be considered an external effect.

  18. 18.

    Viscusi(2003) harshly criticize the imperfect rationality approach, claiming that consumers are well informed and often overestimate the true risks due to smoking.

  19. 19.

     If the above counterargument is accepted current smokers pay for health care of other smokers, implying a forced solidarity. See also Viscusi(2003).

  20. 20.

     There is evidence that magazine’s coverage of smoking hazards is inversely linked to the share of advertising revenue coming from cigarettes (Warner 1985).

  21. 21.

     Those who smoke or are interested in smoking pay more attention to advertising and are more influenced by advertising.

  22. 22.

     For a survey of results see: Davis et al. 2008; see also Slater et al. 2007.

  23. 23.

     Longitudinal studies are not without drawbacks, such as the failure to take account of individuals dropped from the sample, that can be non-randomly distributed between smokers and nonsmokers, and the possibility of spurious effects due to omitted variables influencing both advertising and consumption.

  24. 24.

    In India low-income segment usually consumes other products, such as Bidi.

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Authors and Affiliations

  1. Department of Molecular Medicine, “Sapienza” University of Rome, Viale Regina Elena 324, Rome, 00161, Italy

    Guido Citoni

  2. Istituto di Igiene, Università Cattolica del Sacro Cuore, Largo Francesco Vito, n. 1, Rome, 00168, Italy

    Maria Lucia Specchia

  3. Department of Public Health and Infectious Diseases, “Sapienza” University of Rome, Piazzale Aldo Moro 5, Rome, 00185, Italy

    Alice Mannocci & Giuseppe La Torre

  4. Institute of Hygiene, Catholic University of the Sacred Heart, L.go F. Vito 1, Rome, 00168, Italy

    Silvio Capizzi

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  1. Guido Citoni
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Correspondence to Giuseppe La Torre .

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Citoni, G., Specchia, M.L., Mannocci, A., Capizzi, S., La Torre, G. (2013). Economic Issues Related to Tobacco Smoking. In: Smoking Prevention and Cessation. Springer, Boston, MA. https://doi.org/10.1007/978-1-4614-7046-5_14

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