OBSERVATIONAL MACRO ANALYSIS ON THE AGGREGATED CIGARETTE PRICE ELASTICITY IN DENMARK 1978-2010

Author(s)

Clemmensen KKBStudent at Copenhagen University, Copenhagen, Denmark

OBJECTIVES: Tobacco smoking is the leading cause of early death and morbidity in the Western World. The causal association between smoking and a range of cancers, heart disease and chronic obstructive lung disease is well-established. Numerous publications show that increased tobacco prices leads to lower tobacco consumption. The aim of this study is to show the aggregated price elasticity between sale of cigarettes and price on cigarettes in Denmark from 1978 to 2010. METHODS: Data on the price of cigarettes is from Statistics Denmark table PRIS1 (1978-2000) and PRIS6 (2000-2010). The price index of cigarettes was deflated with the consumer price index. Data on sale of cigarettes in Denmark is from Statistics Denmark table ALKO4. Price elasticity was estimated with OLS regression. Data were analyzed in SAS version 9.2. RESULTS: The real price of cigarettes has decreased in Denmark between 1978 and 2010. The estimated crude aggregated price elasticity for cigarettes in Denmark from 1978-2010 -0.4 (p 0.015) which is in line with results for other countries. CONCLUSIONS: The price on cigarettes is a tool to regulate the consumption of cigarettes. A tool that have not yet been used in Denmark where there have been a decrease in the real price of cigarettes. Studies have shown that especially youth and lower income groups have high price elasticity on tobacco goods. These groups can be hard to reach with other prevention measures.  An increase in tobacco taxation especially if done across Europe and with increased police effort to stop smuggling and contraband cigarettes could be a way to lower the population’s tobacco consumption.

Conference/Value in Health Info

2012-11, ISPOR Europe 2012, Berlin, Germany

Value in Health, Vol. 15, No. 7 (November 2012)

Code

PCN145

Topic

Epidemiology & Public Health

Topic Subcategory

Public Health

Disease

Cardiovascular Disorders, Oncology, Respiratory-Related Disorders

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