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Article
Publication date: 1 July 1987

K.E. Kioulafas

The factors underlying the variations in sales of different varieties of cigarettes in Greece did not always show that changes in selling prices always had an impact on sales…

Abstract

The factors underlying the variations in sales of different varieties of cigarettes in Greece did not always show that changes in selling prices always had an impact on sales. Advertising has a significant impact on the demand for the better varieties of cigarette, and advertisers should be aware of different reactions to “basic” and “extra‐fine” cigarettes. Marketing planners must bear in mind that average retail selling price has an impact on most sales to foreigners, except those of “fine” and “extra‐fine”, so price can be used to increase sales in certain cases.

Details

European Journal of Marketing, vol. 21 no. 7
Type: Research Article
ISSN: 0309-0566

Keywords

Book part
Publication date: 20 May 2017

Philip DeCicca, Donald Kenkel, Feng Liu and Hua Wang

The U.S. 2009 Tobacco Control Act opened the door for new antismoking policies by giving the Food and Drug Administration broad regulatory authority over the tobacco industry. We…

Abstract

The U.S. 2009 Tobacco Control Act opened the door for new antismoking policies by giving the Food and Drug Administration broad regulatory authority over the tobacco industry. We develop a behavioral welfare economics approach to conduct cost-benefit analysis of FDA tobacco regulations. We use a simple two-period model to develop expressions for the impact of tobacco control policies on social welfare. Our model includes: nudge and paternalistic regulations; an excise tax on cigarettes; internalities created by period 1 versus period 2 consumption; and externalities from cigarette consumption. Our analytical expressions show that in the presence of uncorrected internalities and externalities, a nudge or a tax to reduce cigarette consumption improves social welfare. In sharp contrast, a paternalistic regulation might either improve or worsen social welfare. Another important result is that the social welfare gains from new policies do not only depend on the size of the internalities and externalities, but also depend on the extent to which current policies already correct the problems. We link our analytical expressions to the graphical approach used in most previous studies and discuss the information needed to complete cost-benefit analysis of tobacco regulations. We use our model as a framework to reexamine the evidence base for strong conclusions about the size of the internalities, which is the key information needed.

Details

Human Capital and Health Behavior
Type: Book
ISBN: 978-1-78635-466-2

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Book part
Publication date: 7 September 2012

James Langenfeld and Brad Noffsker

In a number of recent multi-billion dollar cases brought against cigarette manufacturers, plaintiffs have in part alleged that the cigarette manufacturers (1) conspired not to…

Abstract

In a number of recent multi-billion dollar cases brought against cigarette manufacturers, plaintiffs have in part alleged that the cigarette manufacturers (1) conspired not to compete on the basis of health claims or the introduction of potentially safer cigarettes since the 1950s, and (2) engaged in fraudulent advertising by making implied health claims in advertisements selling ‘low tar’/‘light’ cigarettes. In this type of litigation, defendants’ actions could be due to alleged illegal behaviour as asserted by plaintiffs, or be the result of market forces that may have nothing to do with allegedly inappropriate acts. We examine the economic evidence relating to these allegations, taking into account some of the major influences on cigarette company behaviour. In particular, our analyses show that much of the cigarette manufactures’ behaviour can be explained by Federal Trade Commission and related government actions, rather than conspiracy or fraudulent acts. We find the economic evidence is inconsistent with an effective conspiracy to suppress information on either smoking and health or the development and marketing of potentially safer cigarettes. Regarding ‘lower tar’ and ‘light’ cigarettes, the economic evidence indicates that the cigarette manufacturers responded to government and public health initiatives, and that disclosing more information on smoking compensation earlier than the cigarette companies did would not have had any significant impact on smoking behaviour.

Details

Research in Law and Economics
Type: Book
ISBN: 978-1-78052-898-4

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Book part
Publication date: 7 September 2012

Melissa A. Menasco

Purpose – This research presents results concerning the impact of family financial stress on adolescent substance use.Design/methodology/approach – Drawing a sample of 18,614…

Abstract

Purpose – This research presents results concerning the impact of family financial stress on adolescent substance use.

Design/methodology/approach – Drawing a sample of 18,614 adolescent males (9,459) and females (9,155) ages 12–17 years from the 2010 National Survey on Drug Use and Health, this work utilizes stepwise logistic regression and ordinary least squares to determine whether family poverty measures are associated with adolescent high-risk behaviors of smoking cigarettes, drinking alcohol, and using marijuana.

Findings – This study found limited support for adolescent substance use within families who are experiencing economic distress. Adolescents from families who had moved at least once in the prior year were more likely to have used cigarettes, alcohol, and marijuana. Furthermore, males and females who disapprove of peers’ substance using behaviors are less likely to use those substances.

Research limitations/implications – This study may not explain adolescent substance using behavior outside of the United States. Further research into socioeconomic factors should be addressed in subsequent work as should the intermediary variables pertaining to the parent–child relationship.

Practical implications – Understanding contributing factors to adolescent substance use will assist in developing social policy that will support families.

Originality/value – This study provides insight into the consequences of family characteristics both socioeconomic and psychosocial which influence adolescent substance using behaviors.

Details

Economic Stress and the Family
Type: Book
ISBN: 978-1-78052-978-3

Keywords

Book part
Publication date: 13 December 2013

Wei Tan

A dynamic oligopoly model of the cigarette industry is developed to study the responses of firms to various antismoking policies and to estimate the implications for the policy…

Abstract

A dynamic oligopoly model of the cigarette industry is developed to study the responses of firms to various antismoking policies and to estimate the implications for the policy efficacy. The structural parameters are estimated using a combination of micro and macro level data and firms’ optimal price and advertising strategies are solved as a Markov Perfect Nash Equilibrium. The simulation results show that tobacco tax increase reduces both the overall smoking rate and the youth smoking rate, while advertising restrictions may increase the youth smoking rate. Firm’s responses strengthen the impact of antismoking policies in the short run.

Details

Structural Econometric Models
Type: Book
ISBN: 978-1-78350-052-9

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Open Access
Article
Publication date: 12 September 2023

Mai-Huong Vo, Ngoc-Anh Nguyen, Estelle Dauchy and Nuong Nguyen

This study aims to estimate the pass-through rate of the increases in the excise tax and TCF tax on tobacco in Vietnam. This study seeks to shed light on how the tax burden is…

Abstract

Purpose

This study aims to estimate the pass-through rate of the increases in the excise tax and TCF tax on tobacco in Vietnam. This study seeks to shed light on how the tax burden is split between consumers and producers and inform policy discussions in the country. Using panel micro-level data collected from three waves of a nationwide retailer's survey, this study provides an evidence-based pass-through estimation for tobacco tax in Vietnam and contributes to the understanding of tax policy on smoking and smoking-related issues.

Design/methodology/approach

Following increases in the excise tax and TCF tax on tobacco in 2019, the differential effect of the tax hike on the “treatment group” (domestic cigarettes) versus the “control group” (illicit cigarettes) using a difference-in-difference (DID) analysis has been studied. The study utilized unique longitudinal retailers’ data on cigarettes prices in Vietnam from 2018 to 2019 to estimate the tax pass-through rate for some of the most popular factory-made cigarette brands.

Findings

This study found evidence of an over-shifting of cigarette taxes on smokers. Specifically, it discovered that the tax increase is absorbed more by low-priced brand smokers compared to premium brand users due to (1) the limited increase in prices under a pure ad valorem system and (2) the way the Vietnamese currency is denominated. Additionally, there is evidence of cushioning to mitigate price shock on consumers as the real prices increase gradually over the period of one year after the tax change.

Originality/value

To the best of the authors’ knowledge, this study is the first to collect and analyze a unique panel micro-level data from three waves of a nationwide retailers’ survey, which captures the changes in marketing and pricing strategies of the tobacco industry in Vietnam before and after an increase in excise tax in 2019. The results of this study could be used as a reference for future policymakers in considering increasing taxes on tobacco.

Details

Fulbright Review of Economics and Policy, vol. 3 no. 2
Type: Research Article
ISSN: 2635-0173

Keywords

Article
Publication date: 5 July 2023

Yanmei Xu, Yanan Zhang, Ziqiang Wang, Xia Song, Zhenli Bai and Xiang Li

Unlike traditional industries, the e-cigarette is an epoch-making innovative product originating in China and occupying an absolute competitive advantage in the international…

Abstract

Purpose

Unlike traditional industries, the e-cigarette is an epoch-making innovative product originating in China and occupying an absolute competitive advantage in the international market. The traditional A-U model describes the laws and characteristics of technological innovation in developed countries. In contrast, the inverse A-U model depicts the process of “secondary innovation” in late-developing countries through digestion and absorption. This paper aims to find out that if the e-cigarette, as a “first innovation” industry in a late-developing country, conform to the A-U model or conform to the “inverse A-U model”.

Design/methodology/approach

This paper takes the patent data of e-cigarettes from 2004 to 2021 as the research object, and uses Python’s Jieba segment words to divide product innovation and process innovation, and then uses statistical analysis methods to conduct empirical analyses on these data.

Findings

Thus, an improved A-U model suitable for the e-cigarette industry is proposed. In this model, product innovation in the e-cigarette industry appeared earlier than process innovation, but the synchronous development of product and process innovation is not lagging. The improved A-U model in the e-cigarette industry is not only different from the traditional A-U model but also does not conform to the inverse A-U model.

Research limitations/implications

It is conducive to expanding and clarifying the theoretical contribution and applicable boundaries of the A-U model and has sparked thinking and exploration of the A-U model in e-cigarettes and emerging industries.

Practical implications

On this basis, suggestions on the development path and countermeasures of the e-cigarette industry are put forward.

Originality/value

Based on the e-cigarette industry, this paper takes patents as the research object and provides the method of dividing product innovation and process innovation, and proposes an A-U model suitable for the e-cigarette industry on this basis. By comparing the traditional A-U model with the inverse A-U model in latecomer countries, the background and causes of e-cigarette A-U model heterogeneity are analyzed from different stages and overall morphology. Based on this, the heterogeneity characteristics of e-cigarette innovation are summarized and sorted out.

Details

Nankai Business Review International, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2040-8749

Keywords

Article
Publication date: 5 August 2022

Ray M. Merrill and Carl L. Hanson

This study is a formative evaluation of an adolescent online e-cigarette prevention program (Clearing the Vapor) giving attention to identifying higher risk adolescent…

Abstract

Purpose

This study is a formative evaluation of an adolescent online e-cigarette prevention program (Clearing the Vapor) giving attention to identifying higher risk adolescent populations, confirming the theory of change, and assessing short-term outcomes.

Design/methodology/approach

The evaluation was conducted using online pre-test and post-test survey data collected from adolescent program participants age 10–18 from 2019 to 2021. Analyses included risk ratios on perceived risk, self-efficacy, and behavioral intentions across demographic variables. Pre-test and post-test comparisons were conducted with analysis involving the t-test and the McNemar test.

Findings

Prevalence of e-cigarette use was higher among males, older adolescents, and in racial/ethnic groups other than Whites and Asians. Adolescents with lower confidence to say “no” were more likely to use e-cigarettes. Greater perception of harm by using e-cigarettes increased the likelihood of adolescents feeling competent to explain to peers the harmful effects of e-cigarettes. Mean change in commitment levels to not use e-cigarettes increased for males and females, all ages, and racial/ethnic groups other than non-Hispanic Blacks and American Indians. Improvement in non-Hispanic Whites was significantly greater than for non-Hispanic Blacks, American Indians, and Hispanics.

Originality/value

Improvement in programming should give careful attention to the incorporation of more prevention activities and to materials tailored specifically to racial/ethnic participants. As a theory of change, findings support the utility of the Clearing the Vape prevention programming to address perceptions of harm that e-cigarettes are safe, confidence in explaining the harmful effects of use, and the development of skills to resist use.

Details

Health Education, vol. 122 no. 6
Type: Research Article
ISSN: 0965-4283

Keywords

Article
Publication date: 5 December 2022

James Russell Pike, Stephen Miller, Christopher Cappelli, Nasya Tan, Bin Xie and Alan W. Stacy

This paper aims to apply the Product Life Cycle (PLC) and Product Evolutionary Cycle (PEC) frameworks to the nicotine and tobacco market to predict the impact of television…

Abstract

Purpose

This paper aims to apply the Product Life Cycle (PLC) and Product Evolutionary Cycle (PEC) frameworks to the nicotine and tobacco market to predict the impact of television commercials for electronic cigarettes (e-cigarettes) on youth.

Design/methodology/approach

Surveys were administered over a three-year period to 417 alternative high school students from Southern California who had never used e-cigarettes, cigarettes or cigars at the baseline. Covariate-adjusted logistic regression causal mediation models were used to test competing hypotheses from the PLC and PEC frameworks.

Findings

Results support a refined version of the PEC framework where e-cigarette commercials increase the odds of e-cigarette use, which leads to subsequent use of competing products including cigarettes and cigars.

Practical implications

This investigation demonstrates the utility of frameworks that conceptualize youth-oriented marketing as a two-part process in which potential customers are first convinced to adopt a behavior and then enticed to use a specific product to enact the behavior.

Social implications

Rising rates of nicotine and tobacco product use among youth may be partially attributable to e-cigarette commercials.

Originality/value

Regulations in the USA that permit television commercials for e-cigarettes but restrict the promotion of cigarettes and cigars have created an opportunity to study product adoption among youth consumers when one product has a strategic marketing advantage.

Details

Young Consumers, vol. 24 no. 2
Type: Research Article
ISSN: 1747-3616

Keywords

Case study
Publication date: 26 October 2015

Chen Cheng, Nicola Persico and Nicola Scocchi

You are the CEO of an e-cigarette company that has just been acquired by a major tobacco company. Your company operates in the European market. The July 2013 draft of the EU…

Abstract

You are the CEO of an e-cigarette company that has just been acquired by a major tobacco company. Your company operates in the European market. The July 2013 draft of the EU Tobacco Products Directive (TPD) recently has been crafted by the European Commission, but it has not yet been examined by the EU Parliament and its Council. The draft proposes that all e-cigarette products be classified as medical devices, regardless of nicotine content. This is the strictest available mode of regulation. If the directive goes into effect as written, e-cigarettes would have to undergo costly and lengthy clinical trials to receive approval and face much stricter marketability restrictions.

The case details the state of the e-cigarette industry in 2013, including consumer data, distribution, competition from similar products, and public health concerns. Students will analyze the current regulatory environment, determine what outcome would be most favorable to the e-cigarette industry, and identify the ways to achieve that goal.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

1 – 10 of over 5000