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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.

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.

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.

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.

This chapter examines the impact of cigarette prices, taxes, and tobacco control policies on youth and young adult smoking propensity and intensity in the U.S. during the years 1997–2001, a period characterized by significant changes in cigarette prices and tobacco control policies. Employing a fixed effects technique, we find a strong negative impact of cigarette prices and taxes on youth and young adult smoking prevalence and conditional demand. Moreover, we find purchase, use, and possession laws to be inversely related to youth and young adult smoking prevalence.

Purpose – With reference to the long-term struggle to confirm cigarette smoking as a manifestation of nicotine addiction, this chapter explores the extent to which new understandings of addictions as ‘appetitive disorders’ rather than ‘dependence disorders’ derive from treatment technology development as well as advances in basic scientific research.

Approach – Through historical analysis it is discussed how cigarette smoking only became widely accepted as a real drug problem in the 1980s after it had been shown to be amenable to treatment as such through the use of novel nicotine replacement therapies.

Findings – These replacement therapies succeeded in showing that the same drug that drew users into addiction could be redeployed to help draw up them out of it. Nicorette® could serve as at least the partial antidote to nico-wrong (cigarettes). However, as relapse to smoking has remained the most likely outcome of any smoking cessation attempt, so medicinal nicotine has also served to demonstrate that nicotine addiction is ultimately a problem of an uncontrollable appetite for cigarettes in excess of drug dependence.

Implications – Pharmaceutical incursion on cigarette smoking commencing in the late 1970s pointed to the need for a new mental disease model of drug-related problems while also providing valuable new tools and insights for ensuing brain research.

I discuss economic approaches to the demand for harmfully addictive substances with an emphasis on the role of money prices. First, I examine trends in the real prices and in the prevalence of the use of cigarettes, alcohol, cocaine, heroin, and marijuana in the U.S.A. Then I present estimates of time-series demand functions. Next, I discuss how economists have modified their traditional model of consumer behaviour to incorporate the addictive aspects of illegal substances. I conclude with implications for tax policy and for the lively and contentious debate concerning the legalization of marijuana, cocaine, and heroin.

In Chapter 3, the author will problematise the youth smoking epidemic within SEA, in order to justify why the regional impacts of the tobacco trade on youths are worrisome. The author will present the major youth smoking trends in SEA, for the purpose of illustrating how the presence of tobacco products has adversely affected regional youths to a concerning degree. The author, next, will highlight the causes of the youth smoking epidemic, namely susceptibility and positive advertising. The author follows by emphasising the national and regional costs of youth smoking, by arguing how such a lifestyle results in negative consequences in relation to the delinquency itself. Lastly, the author will recommend policies for tobacco control that SEA governments should consider to contain the epidemic of youth smoking. It is noteworthy that all SEA governments have some degree of tobacco control policies in place. However, many lack the implementation of comprehensive national tobacco control strategic plans and tightened law enforcement endeavours to specifically target the problem of youth smoking. Therefore, the outputs of this chapter should contain scholarly values that are conducive to the betterment of policy-making.

This study examines variation in health-related coping strategies among the widowed by variation in bereavement, as modified by self-efficacy, religiosity, social support, and self-rated health. Coping strategies are documented by gender, race, age, and income level, and the interaction of gender and race. Data are from the Changing Lives of Older Couples Study (CLOC), a longitudinal dataset from a random sample of older adults from the Detroit Metropolitan area. Bereavement is related to overall negative coping behavior, specifically to daily cigarette consumption and physical inactivity. However, the effect varies based on the gender, race, and age of the widowed, as well as type of moderator.

We develop and test a pricing model for a monopolist that sells an addictive good. The model illustrates the conditions under which a monopolist lowers the price he charges youth when a future tax is imposed. Using household survey data, we investigate whether individuals use “cents-off” coupons in a way consistent with the price discrimination implied by the model. We find evidence that all smokers, not just the young, are more likely to use coupons prior to a tax increase if they are exposed to more advertising. With our data we cannot test whether cigarette manufacturers selectively offer youth price discounts in other ways.