5.12 Affordability of tobacco products

Last updated April 2012 

As noted in Section 5.11, many young smokers do not purchase their own cigarettes directly, but obtain them through their social network and from other informal sources. Australian research indicates that in 2008, the two most common ways to access cigarettes among high school current smokers were through their friends and by asking someone else to buy them.1 The likelihood of adolescents themselves buying cigarettes over the counter increases with age1 and with frequency of smoking.2 It is likely that tobacco pricing is not a major concern for those very young smokers, who may only be experimenting with smoking in a one-off or occasional way.3 However, as smoking behaviour becomes more established and adolescents increasingly finance their own tobacco purchases, affordability of cigarettes becomes a far more important consideration.

A substantial body of evidence demonstrates that youth smokers are particularly sensitive to rises in tobacco prices.3 For example, it has been estimated that a 10% increase in cigarette prices reduces purchases by 4% among all smokers (based on US figures), while the equivalent estimate for young people is a 7% reduction in cigarette purchases.4 Higher cigarette prices are associated with a reduced probability of youth smoking,5 including reduced current prevalence and consumption.5,6 Research also suggests that cigarette price rises may foster cessation-related behaviours among high school smokers.6

There is some US research suggesting that the influence of price increases has become more important to young smokers in recent years (that is, during the 1990s, when prices increased sharply). This research was based on time-series analyses of data collected between 1976 and 2002 from US high school students.7 In seeking to explain this trend, the authors suggest that it may be because only when cigarette prices reach a certain threshold does the cost to young people became significant enough to influence their smoking.7

Young people's price sensitivity to cigarette pricing can work in two directions–while they are particularly sensitive to price increases, it has also been suggested that a decrease in cigarette prices would have a detrimental effect on smoking prevalence among young people, and of a greater magnitude of impact on prevalence than an equivalent increase in price would reduce smoking. This research finding was based on a US study involving a pooled cross-sectional analysis of smoking among more than 122 000 young people aged 15–24 years from 90 000 households (1992–1999).8 This is alarming in light of the growing number of cheap imported cigarettes in packs of 20 that are substantially cheaper than the most popular brands in Australia–see Chapter 13, Section 13.3 for further details. In the UK, packs of 14, introduced in five brands, have been promoted extensively to the 'price conscious' smoker at a low recommended retail price (e.g. £3.82 or €4.34/USD$6.25).9

Fiscal policy and pricing of cigarettes is an integral component of comprehensive tobacco-control policy10,11 for reducing prevalence and encouraging cessation among adults, and as discussed in this section, is just as important for youth smoking prevention efforts. The effects of tax increases on consumption are discussed briefly in Section 5.22 and in detail in Chapter 13, Section 13.1.5.


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References

1. White V and Smith G. Australian secondary school students' use of tobacco, alcohol, and over-the-counter and illicit substances in 2008. Canberra: Drug Strategy Branch, Australian Government Department of Health and Ageing, 2009. Available from: http://www.nationaldrugstrategy.gov.au/internet/drugstrategy/Publishing.nsf/content/2C4E3D846787E47BCA2577E600173CBE/$File/school08.pdf

2. White V and Hayman J. Smoking behaviours of Australian secondary students in 2005. National Drug Strategy Monograph series no. 59. Canberra: Drug Strategy Branch, Australian Government Department of Health and Ageing, 2006. Available from: http://www.nationaldrugstrategy.gov.au/internet/drugstrategy/publishing.nsf/Content/mono59

3. Liang L and Chaloupka F. Differential effects of cigarette price on youth smoking intensity. Nicotine & Tobacco Research 2002;4:104-14. Available from: http://www.ncbi.nlm.nih.gov/pubmed/11906687

4. Pampel FC and Aguilar J. Changes in youth smoking, 1976–2002: a time-series analysis Youth & Society 2008;39(4):453–79. Available from: http://yas.sagepub.com/cgi/reprint/39/4/453

5. Ross H and Chaloupka F. The effect of cigarette prices on youth smoking. Health Economics 2003;12(3):217–30. Available from: http://econpapers.repec.org/article/wlyhlthec/v_3A12_3Ay_3A2003_3Ai_3A3_3Ap_3A217-230.htm

6. Tworek C, Yamaguchi R, Kloska D, Emery S, Barker D, Giovino G, et al. State-level tobacco control policies and youth smoking cessation measures. Health Policy 2010;97(2-3):136-44. Available from: http://www.ncbi.nlm.nih.gov/pubmed/20483500

7. FCTC/COP4(10). Partial guidelines for implementation of Articles 9 and 10 of the WHO Framework Convention on Tobacco Control (Regulation of the contents of tobacco products and Regulation of tobacco product disclosures). Geneva: World Health Organization, 2010. Available from: http://www.who.int/fctc/guidelines/Decisions9and10.pdf

8. Harris J and González López-Valcárcel B. Asymmetric peer effects in the analysis of cigarette smoking among young people in the United States, 1992-1999. Journal of Health Economics 2008;27(2):249–64. Available from: http://www.ncbi.nlm.nih.gov/pubmed/18179836

9. Mooney H. Antismoking campaigners lambast packs of 14 cigarettes. British Medical Journal 2011;342:d2920. Available from: http://www.bmj.com/content/342/bmj.d2920.long

10. US Department of Health and Human Services. Reducing tobacco use: a report of the Surgeon General. Atlanta, Georgia: US Department of Health and Human Services, Centers for Disease Control and Prevention, National Center for Chronic Disease Prevention and Health Promotion, Office on Smoking and Health, 2000. Available from: http://www.cdc.gov/tobacco/sgr/sgr_2000/index.htm

11. Liang L, Clayton R and Nichter M. Prices, policies and youth smoking, May 2001. Addiction 2003;98(suppl.1):i105–22. Available from: http://www.ingentaconnect.com/content/bsc/add/2003/00000098/A00101s1/art00007;jsessionid=gehufx0tx8bb.alice

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