Is cigarette smoking in poorer nations highly sensitive to price? Evidence from Russia and China

Listed in:

• Adults' demand for tobacco products
• Youths' demand for tobacco products
• Tax, price and tobacco use: Adults
• Tax, price and tobacco use: Youth

Abstract

We examine cigarette demand in China and Russia using longitudinal micro-level household and community surveys. Previous developing-country price elasticity estimates of around −0.75 have been larger than United States estimates of about −0.4, but the former have relied primarily on aggregate data. In contrast, our micro-level price elasticity estimates in China and Russia range from 0 to −0.15. Thus, raising prices in poorer countries may not reduce smoking to the degree previously suggested.