The Demand For Cigarettes and Restrictions on Smoking in the Workplace

Frank J. Chaloupka, Henry Saffer

NBER Working Paper No. 2663
Issued in July 1988
NBER Program(s):Health Economics Program

The purpose of this paper is to empirically test the effect that restrictive clean air laws have on the level of smoking. Restrictive clean air laws refers to the laws which prohibit smoking in private workplaces as well as in public places. The data employed in this study consist of a time series of cross sections of the fifty states of the U.S., and Washington D.C., over the time period from 1975 through 1985, Since states where sentiment is strongly against cigarettes are more likely to pass a clean air law, endogeneity between cigarette demand and the clean air law is a problem. A two step estimation model is used to control for endogeneity. Both a single equation and a two equation model of cigarette demand were estimated. The single equation results indicate that a clean air law has a significant negative effect on cigarette demand. However, the two equation model indicates that cigarette demand has a significant negative effect on the probability of passing a clean air law. The results indicate that when endogeneity is controlled for the clean air law dose not have a significant effect on cigarette demand. This does not imply that the enactment of a clean air law would not reduce the level of smoking if such a law were imposed in all states, but rather that only states with low levels of smoking are able to pass restrictive clean sir laws.

download in pdf format
   (145 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w2663

Published: "Clean Indoor Air Laws and the Demand for Cigarettes." Contemporary Policy Issues, Volume X, No. 2, April 1992, pp. 72-83

Users who downloaded this paper also downloaded* these:
Tauras and Liang w9790 The Impact of Physician Intervention and Tobacco Control Policies on Average Daily Cigarette Consumption Among Adult Smokers
Chaloupka and Warner w7047 The Economics of Smoking
Kostova, Ross, Blecher, and Markowitz w15781 Prices and Cigarette Demand: Evidence from Youth Tobacco Use in Developing Countries
Cawley and von Hinke Kessler Scholde w18805 The Demand for Cigarettes as Derived from the Demand for Weight Control
Saffer and Dave w8699 Mental Illness and the Demand for Alcohol, Cocaine and Cigarettes
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us