Cross-country and panel data estimates of the price elasticity of demand for cigarettes in Europe

OBJECTIVE

Our goal is to provide estimates of the price elasticity of demand for cigarettes in Europe as a basis for public health policy on tobacco taxation.

METHODS

We use secondary data on cigarette retail sales including illicit trade, prices, tobacco control measures and income from 2010 to 2020 of 27 European countries from Euromonitor, the WHO, the Tobacco Control Scale and the World Bank. We estimate the price elasticity of demand using instrumental variable regressions as well as panel data regressions taking into account that prices and quantities are determined simultaneously in the market.

RESULTS

Based on cross-section data at the country level, we find that during the decade from 2010 to 2020, the demand for cigarettes in Europe has become neither more nor less elastic. Our estimates of the price elasticity based on panel data are around -0.4 (95% CI -0.67 to -0.24), in line with previous estimates for high-income countries. Furthermore, our analysis shows that estimates of the price elasticity of demand that are based on data including illicit trade tend to be lower. This has also been found in the previous literature.

CONCLUSIONS

By providing state-of-the-art, up-to-date estimates of the price elasticity of demand that are in line with the previous literature, we show that taxation can still be a cost-effective tobacco policy to reduce cigarette consumption and thus, the burden of smoking.

Gender differences in the price elasticity of demand for waterpipe and cigarette smoking in Lebanon, Jordan and Palestine: a volumetric choice experiment

OBJECTIVES

This study assessed the extent to which the elasticity of cigarette and waterpipe tobacco products differs between men and women. We also explored the levels of substitution and complementarity in tobacco products among men and women.

SETTING

The study examines tobacco elasticities in three Arab countries: Lebanon, Jordan and the West Bank of Palestine.

PARTICIPANTS

We used data from nationally representative surveys of adults aged ≥18 years in Lebanon (n=1680), Jordan (n=1925) and Palestine (n=1679). The proportion of women was 50.0% of the sample in Lebanon and Palestine, and 44.6% in Jordan.

PRIMARY AND SECONDARY OUTCOME MEASURES

A zero-inflated Poisson regression model estimated own-price and cross-price elasticities for two variations of cigarettes and five variations of waterpipe tobacco products. Elasticities were measured based on eight scenarios of prices.

RESULTS

Demand for waterpipe tobacco products was elastic for both men and women. The cross-price elasticities in the three countries indicate the existence of substitution between cigarettes and waterpipe products and by different varieties within each of the two tobacco products. Gender differences varied across the three countries whereby higher cross-price elasticities were observed for women in Jordan and Palestine. For example, the price elasticity for discount waterpipe was -1.4 and -0.6 for women and men in Jordan, respectively.

CONCLUSIONS

Results on the elasticity of demand for tobacco products and the existence of substitution between tobacco products reveal the higher responsiveness of men and women to changes in tobacco prices. This should be taken into consideration in tobacco control strategies particularly when reducing tobacco consumption via taxation policies.

Effect of IQOS introduction on Philip Morris International cigarette sales in Spain: a Logarithmic Mean Divisa Index decomposition approach

OBJECTIVE

Philip Morris International, has already introduced its heated tobacco product, IQOS, in many countries and marketed it on the grounds that it is a less harmful alternative to health. The company claims that its intention is for its brand's traditional cigarette smokers to replace these with IQOS has rarely been independently tested.

METHOD

Using time series data from September 2016 to June 2020, we analyze whether Heets sales have been accompanied by an improvement in the position of Philip Morris International in the market or if they have merely replaced lost sales of the rest of the brands sold by that tobacco company.

RESULTS

Sales of traditional cigarettes of all the brands marketed by PMI have been replaced by IQOS since the introduction of this heated tobacco product in Spain. Almost all of the variations observed in IQOS sales are due to the positioning of this product as a substitute for the range of traditional cigarettes marketed by Philip Morris International.

CONCLUSIONS

As there is still no consensus that HTPs are explicitly less harmful to health, health authorities must control messages suggesting improved health outcomes thanks to HTP usage when compared to traditional cigarettes. Such messages could generate a false sense of security and lead to an increase in the consumption of tobacco. In Spain Heets in a category that has a lower tax burden than the category of traditional cigarettes. Tax authorities must consider this migration and the impact this may have on tax collection.

The neighborhood environment and its association with the spatio-temporal footprint of tobacco consumption and changes in smoking-related behaviors in a Swiss urban area

This study aimed to evaluate the association of the neighborhood environment with the spatio-temporal dependence of tobacco consumption and changes in smoking-related behaviors in a Swiss urban area. Data were obtained from the CoLaus cohort (2003-2006, 2009-2012, and 2014-2017) in Lausanne, Switzerland. Local Moran's I was performed to assess the spatial dependence of tobacco consumption. Prospective changes in tobacco consumption and the location of residence of participants were assessed through Cox regressions. Analyses were adjusted by individual and neighborhood data. The neighborhood environment was spatially associated with tobacco consumption and changes in smoking-related behaviors independently of individual factors.

Measuring anomalies in cigarette sales using official data from Spanish provinces: Are the anomalies detected by the Empty Pack Surveys (EPSs) used by Transnational Tobacco Companies (TTCs) the only anomalies?

INTRODUCTION

There is a literature that questions the veracity of the studies commissioned by transnational tobacco companies (TTCs) to measure the illicit tobacco trade. Furthermore, there are studies that have indicated that the empty pack surveys (EPSs) ordered by TTCs overestimate the size of this trade. This study simultaneously analyzed whether the EPSs established in each of the 47 Spanish provinces were accurate and measured anomalies observed in provinces where sales exceed expected values.

METHODS

To achieve the objectives of this study, provincial data on cigarette sales, prices and GDP per capita were used. These data were modeled with machine learning techniques that are widely used to detect anomalies in other areas.

RESULTS

The magnitude of the average anomaly in provinces where sales are higher than their expected values exceeds 40%, while the average anomaly in provinces where sales are lower than their expected values (as detected by the EPSs) is <15%. Furthermore, the results reveal that there is a clear geographical pattern to the provinces in which sales below reasonable values are observed. In addition, the values provided by the EPSs in Spain, as indicated in the previous literature, are slightly overestimated. Finally, some regions bordering other countries or that are highly influenced by tourism have observed sales that are higher than their expected values.

CONCLUSIONS

Cooperation between countries in their tobacco control policies can have better effects than policies developed based on information from a single country. The lack of control over the transactions of tourists and the inhabitants of bordering countries can cause important anomalies that distort the understanding of tobacco consumption that governments have based on official data.

The effect of price on cigarette consumption, distribution, and sale in Tehran: a qualitative study

Background

Appropriate increases in tobacco taxes and prices are an essential component of comprehensive tobacco control strategies. This study investigates factors related to the use, sale, and distribution of cigarettes in Iran, focusing on the relationship between cigarette price and its consumption.

Methods

This interview-based qualitative study was conducted among 20 participants, including cigarette smokers, retail shop owners, large-scale distributors, and an expert in tobacco control research.

Results

Seven themes were extracted from participant interviews, including the type and price of cigarette, the best time to sell cigarettes, profits from the sale of cigarette, affordability, rise in cigarette price and smokers’ reaction to it, lobbying and black-market sales of cigarettes, and the sale and distribution of cigarettes across the country. Although the price of cigarettes in Iran has shown some increases in the past decade, the timing of these increases are not predictable and the limited amount of these increases has not reduced the use of cigarettes. Following a price increase, consumers are more likely to switch from buying packets to single cigarettes, or buy a less expensive brand, then to quit. Moreover, increases in prices may encourage smokers and sellers to buy a large number of cigarettes and store them for a rainy day. Another adverse effect may be increased smuggling of illicit cigarettes to balance the pressure caused by rising prices.

Conclusions

Our findings highlight two important aspects concerning cigarette pricing in Iran. First is the change in the type of purchase from the whole box of cigarettes to the single stick cigarette or swapping to less expensive cigarettes. Second, increase in cigarette price (either through taxing or regular increases) could be offset by flooding smuggled cigarettes into the market. Therefore, in addition to raising cigarette prices, reducing cigarette consumption rates in Iran requires the development and effective implementation of regulatory policies to control cigarette smuggling, reduce purchasing, and subsequently curb the use of this leading cause of premature morbidity and mortality.

Supplementary Information

The online version contains supplementary material available at 10.1186/s12889-021-11733-5.

Spatial clusters of daily tobacco consumption before and after a smoke-free policy implementation

This study assessed the spatial dependence of daily tobacco consumption and how it is spatially impacted by individual and neighborhood socioeconomic determinants, and tobacco consumption facilities before and after a smoke-free implementation. Individual data was obtained from the Bus Santé, a cross-sectional survey in Geneva. Spatial clusters of high and low tobacco consumption were assessed using Getis-Ord Gi*. Daily tobacco consumption was not randomly clustered in Geneva and may be impacted by tobacco consumption facilities independently of socioeconomic factors and a smoking ban. Spatial analysis should be considered to highlight the impact of smoke-free policies and guide public health interventions.

Health impact assessment to predict the impact of tobacco price increases on COPD burden in Italy, England and Sweden

Raising tobacco prices effectively reduces smoking, the main risk factor for chronic obstructive pulmonary disease (COPD). Using the Health Impact Assessment tool "DYNAMO-HIA", this study quantified the reduction in COPD burden that would occur in Italy, England and Sweden over 40 years if tobacco prices were increased by 5%, 10% and 20% over current local prices, with larger increases considered in secondary analyses. A dynamic Markov-based multi-state simulation modelling approach estimated the effect of changes in smoking prevalence states and probabilities of transitioning between smoking states on future smoking prevalence, COPD burden and life expectancy in each country. Data inputs included demographics, smoking prevalences and behaviour and COPD burden from national data resources, large observational cohorts and datasets within DYNAMO-HIA. In the 20% price increase scenario, the cumulative number of COPD incident cases saved over 40 years was 479,059 and 479,302 in Italy and England (populous countries with higher smoking prevalences) and 83,694 in Sweden (smaller country with lower smoking prevalence). Gains in overall life expectancy ranged from 0.25 to 0.45 years for a 20 year-old. Increasing tobacco prices would reduce COPD burden and increase life expectancy through smoking behavior changes, with modest but important public health benefits observed in all three countries.