Do Informal Social Markets and Online Sellers Help Youths to Avoid E-Cigarette Taxation?
Youths who vape nicotine rarely make in-person purchases of e-cigarettes from a vendor but instead rely on alternative methods to obtain electronic nicotine delivery system (ENDS) products. This study is the first to explore whether the informal social market and online purchasing options help to insulate youths from e-cigarette taxation. Using data from the State Youth Risk Behavior Surveillance Surveys, we find that ENDS taxation reduces both the likelihood of teens obtaining ENDS products through direct in-person retail purchases as well as the likelihood of relying on informal social sources for e-cigarettes such as borrowing vaping devices from friends or third-party purchases. Auxiliary analyses from the Population Assessment of Tobacco and Health are generally consistent with these findings and suggest that impacts are concentrated on the initiation margin; higher ENDS taxes deter youths initiating through direct retail purchases as well as through the social market. For older teens ages 18 and older, however, we find that informal social sources may attenuate the impacts of e-cigarette taxes. Finally, we detect some evidence that ENDS taxes increases the likelihood that teenagers shift to online sources to obtain e-cigarettes.
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Copy CitationChad D. Cotti, Dhaval M. Dave, Tessie Krishna, Erik T. Nesson, and Joseph J. Sabia, "Do Informal Social Markets and Online Sellers Help Youths to Avoid E-Cigarette Taxation?," NBER Working Paper 34880 (2026), https://doi.org/10.3386/w34880.Download Citation
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