Health information and cigarette consumption: supply and spatial considerations

Abstract

Assessments of the impact of health information on smoking incidence have largely been based upon estimates of the national demand for cigarettes. Yet various arguments can be made for health information also affecting the supply of cigarettes. Moreover, the effect of policy may vary spatially. Indeed, by estimating the relationship between U.S. health information, demand, and supply, at the state- level, this is found to be the case in this paper. In particular, while state-level demand has decreased in the wake of health information, supply has also weakened via decreases in competition within the industry. This suggests a potential concern for policies that promote public health yet also raise the attention of antitrust officials.