Publication: Economics of Tobacco Toolkit, Tool 3 : Economic Analysis of Tobacco Demand
Loading...
Date
2013
ISSN
Published
2013
Author(s)
Editor(s)
Abstract
The tobacco epidemic is a worldwide phenomenon with significantly destructive effects on developing, transitional, and industrialized nations. The first scientific evidence on the health consequences of tobacco consumption-specifically, smoking-was discovered in industrialized nations. As a result, the economic analysis of tobacco control issues began and was developed in these countries. This tool attempts to explain the process of analysis of demand for tobacco products as simply as possible. It includes discussions of basic economic and analysis principles (written for non-specialists such as policy makers and analysts) and more advanced technical points (intended for use by the economists and econometricians who will undertake the actual demand analysis). Consumption of tobacco products includes both smoked categories (e.g., cigarettes, hand-rolled tobacco, pipe tobacco, cigars, bidis, kreteks, etc.) and smokeless types (such as snuff and chewing tobacco). In industrialized countries, cigarettes disproportionately influence tobacco epidemics. This tool discusses and presents, in technical detail, each of the steps necessary to conduct an economic demand analysis on tobacco products. In addition, the reader is presented the fundamentals of demand analysis, including its purpose, assumptions, and requirements. In turn, the reasons to intervene in the market for tobacco products stem from the destructive nature of tobacco consumption. Smoking is the single largest preventable cause of premature death in industrialized countries. In economic terms, the principle of consumer sovereignty holds that individuals know what products are in their best interests to consume. Provided consumers know the risks concerned and internalize all the costs and benefits involved, private consumption decisions result in the most efficient allocation of society's scarce resources. Tobacco products are available to consumers for a price, and an issue of great interest to tobacco control advocates (and the tobacco industry) is to what extent are consumers willing to buy those tobacco products. For instance, the willingness to buy is strongly influenced by such characteristics as the consumer's sense of value, income level, and taste.
Link to Data Set
Citation
“Wilkins, Nick; Yurekli, Ayda; Hu, Teh-wei. Yurekli, Ayda; de Beyer, Joy, editors. 2013. Economics of Tobacco Toolkit, Tool 3 : Economic Analysis of Tobacco Demand. © World Bank. http://hdl.handle.net/10986/16269 License: CC BY 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Economics of Tobacco Toolkit, Tool 2. Data for Economic Analysis(World Bank, Washington, DC, 2013)This tool provides a general introduction to 'the art' of building databases. It addresses a number of issues pertaining to the search, identification and preparation of data for meaningful economic analysis. It can best be thought of as a reference mechanism that provides support for the occasionally frustrated but endlessly hungry researcher working through the adventures of tobacco control analysis. Anyone can reference this tool. This tool addresses a variety of data issues as they pertain to the economic analyses presented in the remaining tools of this toolkit. Most countries in the world today report at least a basic set of national economic and social information. In addition, aggregate or 'macro' level data is also largely available at sub-national levels of these societies and captures information that's reflective of regional, state, provincial, county or other jurisdictional divisions of the country. Consumption represents product use. Therefore, data on tobacco consumption reflects the amount of tobacco products used by a consumer. Data on tobacco product consumption is required for any economic analysis related to the demand for tobacco. Tobacco consumption information can be obtained through surveys of households and/or individual consumers. National population surveys and censuses interview random samples of individuals and/or households in an effort to obtain behavioral and socioeconomic information that will best describe the characteristics of the nation's current population.Publication Tobacco Control in Brazil(World Bank, Washington, DC, 2007-08)The objective of this study was to assess the smoking situation in Brazil, and the role of the tobacco control program, and compare it to experience in other countries. The study assessed key trends in smoking rates and lung cancer in Brazil, and reviewed price and non-price interventions. A discussion of fiscal instruments and smuggling is also included in this report. This study aimed at further evaluating the smoking situation in Brazil, the role of the tobacco control program in the country, and compares it to global best practice and experience in other countries. The study report is structured into three main parts: in the first chapter, trends in smoking prevalence, consumption, and cigarette expenditures in Brazil are reviewed, including the illegal market; in the second chapter, trends in lung cancer mortality and health care costs of smoking-related diseases in the country are analyzed; in the third chapter, non-price and price interventions are reviewed, including those taken by the Brazil tobacco control program, as well as the impact increases in cigarette prices and taxes would have on smoking prevalence and tax revenue. The report concludes with recommendations for further action to protect the Brazilian population from premature death and disease caused by smoking, and to reverse the negative impact of smoking on public expenditures.Publication Determinants of Tobacco Consumption in Papua New Guinea(World Bank, Washington, DC, 2015-06)This paper analyzes smoking prevalence and smoking behaviors in Papua New Guinea. Using the 2009–10 Papua New Guinea Household Income and Expenditure Survey, the paper analyzes the determinants of tobacco use and tobacco choices in Papua New Guinea. The results show that adults (18 years and above) in the poorest quartile are more likely to smoke. Tobacco consumption imposes a large financial burden to poor households. Tobacco consumption accounts for about 23 percent of total household food expenditure for households in the poorest quartile, compared with 15 percent for the entire sample. However, most of these households consume non-processed tobacco. The study reveals the urgency to control tobacco consumption in Papua New Guinea and considers some practical challenges that the country may face.Publication Progression of Tobacco Control Policies : Lessons from the United States and Implications for Global Action(World Bank, Washington, DC, 2008-05)This paper examines the historical experience of tobacco control in the last five decades and shares important lessons of public health interventions to inform current and future tobacco control programs in other countries. The paper is divided into four parts. The first part gives an overview of the political economy, principal influences and interventions in tobacco control in the United States. It stresses the importance of information shocks and the role played by grassroots organizations. The current situation of tobacco control in the United States is further discussed in the second part, with emphasis on the economic case that led to litigation, as well as the response of the industry and the States. The third part focuses on the present efforts of multilaterals like the World Bank, technical United Nation (UN) agencies such as the World Health Organization, in the context of the new global governance structure: the Framework Convention on Tobacco Control (FCTC). The last section discusses lessons learned and provides recommendations for comprehensive tobacco control programs.Publication Economics of Tobacco Toolkit, Tool 6 : Equity Issues, Tobacco, and the Poor(World Bank, Washington, DC, 2013)Currently there are approximately 4 million tobacco related deaths annually. If present trends continue, by the year 2030 the number of deaths will soar to about 10 million annual deaths, with 7 million in low-income countries. However, government action to establish various tobacco control initiatives can prevent this from happening and save a significant number of lives. Tobacco control measures include: i) raising tobacco prices by imposing higher excise taxes; ii) advertising and marketing bans and restrictions; and iii) clean indoor air provisions. A popular and valid concern holds that raising tobacco excise taxes for the purposes of tobacco control imposes an untenable and unfair burden on the poor. In short, it is argued that higher tobacco excise taxes increase inequality in the post-tax distribution of income and reduces the real incomes of a particularly vulnerable group, the poor. This tool discusses a number of approaches in which to examine the validity of this argument. Techniques to analyze the impact of tobacco consumption and tobacco taxes on the poor are explained. And analytical methods using country-specific data are examined so that policy analysts can effectively address concerns about the poor, tobacco consumption, and tobacco control policies.
Users also downloaded
Showing related downloaded files
Publication Early Child Development, From Measurement to Action : A priority for Growth and Equity(Washington, DC: World Bank, 2007)The World Bank recently hosted a symposium on the priority of early child development (ECD) for economic growth and equity. The participants urged application of population-based tools and measures to assess the outcomes of children's early years and children's readiness for school. This study is derived from the symposium and is a valuable resource for policy makers, economists, donors, and investors, as well as researchers and practitioners in early child development. It summarizes the current neuroscience on early child development and major longitudinal studies, the rationale and urgency for greater investment, and countries' innovative funding strategies. The report consists of 15 chapters authored by ECD experts and leaders in the field. The chapters are grouped into five main parts relating to the: business imperative and societal benefits of ECD investments; lessons from evaluation of longitudinal ECD interventions; countries' experiences in monitoring ECD interventions; innovative approaches to countries' financing of ECD initiatives; and next steps on the ECD agenda for the next 5 years. A theme highlighted at the symposium and enlarged upon here is the urgent need for evidence- and population-based instruments and measures to monitor, evaluate, and compare ECD interventions over time and across settings.Publication Making Monitoring and Evaluation Systems Work : A Capacity Development Toolkit(World Bank, 2009)There are constant and growing pressures on governments and organizations around the world to be more responsive to demands from internal and external stakeholders for good governance, accountability and transparency, greater development effectiveness and delivery of tangible results. Governments, parliaments, citizens, the private sector, non-governmental organizations (NGOs), civil society, international organizations, and donors are all among stakeholders interested in better performance. As demands for greater accountability and results have grown, there is an accompanying need for useful and useable results-based monitoring and evaluation systems to support the management of policies, programs, and projects. Governments and other organizations have many different kinds of tracking systems as part of their management toolkits: good human resource systems, financial systems, and accountability systems. They also need good feedback systems. A results-based monitoring and evaluation (M&E) system is essentially such a feedback system; it is a management tool to measure and evaluate outcomes, providing information for governance and decision making. Many management systems have been missing a feedback component to enable them to track the consequences of actions. Building an M&E system gives decision-makers an additional management tool by providing feedback on performance as a basis for future improvement.Publication Disease Control Priorities, Third Edition(Washington, DC: World Bank, 2016-04-06)This book focuses on maternal conditions, childhood illness, and malnutrition. Specifically, the chapters address acute illness and undernutrition in children, principally under age 5. It also covers maternal mortality, morbidity, stillbirth, and influences to pregnancy and pre-pregnancy. It also includes the transition to older childhood, in particular, the overlap and commonality with the child development volume.Publication Changing the Face of the Waters : The Promise and Challenge of Sustainable Aquaculture(Washington, DC: World Bank, 2007)This study provides strategic orientations and recommendations for Bank client countries and suggests approaches for the Bank's role in a rapidly changing industry with high economic potential. It identifies priorities and options for policy adjustments, catalytic investments, and entry points for the Bank and other investors to foster environmentally friendly, wealth-creating, and sustainable aquaculture. The objectives of the study are to inform and provide guidance on sustainable aquaculture to decision makers in the international development community and in client countries of international finance institutions. The study focuses on several critical issues and challenges: 1) Harnessing the contribution of aquaculture to economic development, including poverty alleviation and wealth creation, to employment and to food security and trade, particularly for least developed countries (LDCs); 2) Building environmentally sustainable aquaculture, including the role of aquaculture in the broader suite of environmental management measures; 3) Creating the enabling conditions for sustainable aquaculture, including the governance, policy, and regulatory frameworks, and identifying the roles of the public and private sectors; and 4) Developing and transferring human and institutional capacity in governance, technologies, and business models with special reference to the application of lessons from Asia to Sub-Saharan Africa and Latin America.Publication Climate Change and Migration : Evidence from the Middle East and North Africa(Washington, DC: World Bank, 2014-07-15)Climate change is a major source of concern in the Middle East and North Africa (MENA) region, and migration is often understood as one of several strategies used by households to respond to changes in climate and environmental conditions, including extreme weather events. This study focuses on the link between climate change and migration. Most micro-level studies measure climate change either by the incidences of extreme weather events or by variation in temperature or rainfall. A few studies have found that formal and informal institutions as well as policies also affect migration. Institutions that make government more responsive to households (for example through public spending) discourage both international and domestic migration in the aftermath of extreme weather events. Migration is often an option of last resort after vulnerable rural populations attempting to cope with new and challenging circumstances have exhausted other options such as eating less, selling assets, or removing children from school. This study is based in large part on new data collected in 2011 in Algeria, Egypt, Morocco, Syria, and the Republic of Yemen. The surveys were administered by in-country partners to a randomly selected set of 800 households per country. It is also important to emphasize that neither the household survey results nor the findings from the qualitative focus groups are meant to be representative of the five countries in which the work was carried, since only a few areas were surveyed in each country. This report is organized as follows: section one gives synthesis. Section two discusses household perceptions about climate change and extreme weather events. Section three focuses on migration as a coping mechanisms and income diversification strategy. Section four examines other coping and adaptation strategies. Section five discusses perceptions about government and community programs.