This is not necessarily as straightforward as it might sound (one might be thinking right now, "supply and demand, that about covers it"). Although the economic theory of supply and demand does indeed play a large role in determining the effects of price and tax increases on tobacco consumption levels, it is not the whole story.

My research has identified the importance of tax avoidance via crossing state lines to take advantage of lower cigarette prices (known as "bootlegging"). I have also researched the signaling effects of tax increases versus simple industry price increases; tax-related price increases have a stronger depressive effect on demand than do industry-related price increases. Other research focuses on the effects of mixing information policies into a policy area that already has established excise tax policies, and the effects that addiction has on policy effectiveness.

Finally, there's the issue of taxation as revenue versus taxation as regulation. Governments have two potential reasons to tax cigarettes, both of which may be used simultaneously. This becomes quite confusing, and most probably leads to underperformance in terms of attaining either policy goal.

You can take a look at my papers that I have submitted for publication or have presented at conferences. They are be posted in zipped Microsoft Word format. Also, consult my vita to get information on where you can read my published research.

Regulatory Success Without Government Enforcement: State Clean Indoor Air Laws and Smoking

Policy Instruments and Addictive Behavior: The Effects of Smoking Regulation

Regulation and Federalism: The Politics of State Cigarette Taxation

Comparative Policy Effectiveness: Smoking Regulation in 13 OECD Countries

Data set for my 1997 Political Research Quarterly article "Regulatory Policy When Behavior is Addictive: Smoking, Cigarette Taxes, and Bootlegging"

The CDC also has a lot of data on tobacco and smoking.

More papers and data to come.

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