Anti-smoking publicity, taxation, and the demand for cigarettes

This study demonstrates that anti-smoking publicity in the mass media in Switzerland has had a substantial permanent impact on cigarette consumption. Extended publicity, following the 1964 U.S. Surgeon General's Report, accompanying various tax increases, and preceding a public vote on an advertising ban for tobacco products, decreased consumption permanently by 11%. In addition, publicity had important indirect effects which are reflected in smokers' strong reactions to nominal cigarette price increases. Estimated nominal cigarette price elasticity is -1.0; by contrast, real cigarette prices failed to be significant. Thus, publicity in the mass media provides a powerful tool for deterring cigarette consumption.