Electronic device or regulated tobacco product? Learning from the diffusion of heated tobacco products in Spain

OBJECTIVES

Tobacco companies have introduced heated tobacco product (HTP) in many countries and marketed it on the grounds that it is a less harmful alternative to health. However, tobacco companies have been widely criticized for taking advantage of a loophole that allows electronic devices to circumvent regulations limiting tobacco advertising. This work aims to determine whether HTPs respected the rules that regulate tobacco advertising when it was introduced in Spain.

STUDY DESIGN

This is an observational epidemiological study.

METHODS

Using monthly time series data from September 2016 to June 2020, we analyzed whether the adoption of HTPs has followed the same behavior patterns as other brands that were introduced under the same conditions of use. The Bass model is used to analyze the diffusion of HTPs, and 30 other traditional cigarette brands introduced under the same conditions as this HTPs.

RESULTS

The adoption of HTPs in Spain has been like that of brands of slim cigarettes that are mistakenly considered to be healthier than traditional cigarettes. The results indicate that the use of HTPs has spread in the same way as additive-free and ultra-slim cigarette brands.

CONCLUSIONS

Policymakers should keep in mind that laws should restrict any marketing of tobacco products that promotes positive connotations between tobacco use and being healthy. If manufacturers are allowed to classify a category and/or brand of tobacco products as less harmful to health, the imitation effect is very high, leading to the proliferation of smoking.

Price and income elasticities of demand for cigarette consumption: what is the association of price and economic activity with cigarette consumption in Spain from 1957 to 2016?

OBJECTIVES

Extensive empirical and theoretical studies have been devoted to analyzing the relationship between tobacco and income. The price and income elasticities of demand for cigarette consumption are the main focus of studies in this body of literature. However, few empirical studies exist that analyze how economic growth affects the cigarette market, and no one has studied the effects of economic expansions and recessions. Spain, as in the other countries of the European Union, has suffered a strong recession since 2008. Therefore, this article aims to detect if income elasticity takes different values in economic growth and recession and, in addition, to check whether price elasticity in Spain is consistent with previous studies.

STUDY DESIGN

This is an observational epidemiological study.

METHODS

In this article, the price and income elasticities of demand for cigarette consumption are measured for the Spanish cigarette market using time series data from 1957 to 2016 and by applying a non-linear autoregressive dynamics lag model. The novel specification proposed in this study is the determination of the possible effects of asymmetries in the economic shocks on cigarette consumption.

RESULTS

Our results reveal that cigarette consumption maintains a notable asymmetric relationship. In particular, our results show that in expansion shocks, cigarette consumption increases (a 10% economic growth is associated with a 4.05% increase in cigarette consumption), whereas in recession shocks, cigarette consumption decreases dramatically, with a more pronounced pattern in recession phases than in expansion phases (a 10% economic decline is associated with a 58.16% decrease in cigarette consumption). On the other hand, price elasticity maintains the same behavior shown in the previous literature (a 10% price increase is associated with a 2% decrease in cigarette consumption).

CONCLUSIONS

Higher cigarette prices are associated with decreased smoking. In addition, the economic recession helps in decreasing cigarette consumption. Therefore, it is strongly recommended that tax authorities have our results in mind before establishing health policies. If the authorities do not, it is possible that they will not obtain the expected results in terms of decreased tobacco consumption.