(Semi-)myth #5 (TC). While the health arm of the government tries to discourage smoking, the agricultural arm subsidizes it. This is hypocritical and damaging to the health of the nation. By subsidizing tobacco growing, the government is encouraging smoking. Reality….
While the health arm of the government tries to discourage smoking, the agricultural arm subsidizes it. This is hypocritical and damaging to the health of the nation. By subsidizing tobacco growing, the government is encouraging smoking.
Example of the U.S. system
A complicated web of regulations, with two essential components:
setting annual quotas on tobacco production and minimum prices
limiting growing to holders or renters of allotments (licenses to grow).
The actual subsidy per se is modest.
Impact of the system is...
Direct effect: raise the price of cigarettes by about one cent per pack, by raising the price of tobaccos.
Will decrease smoking (very slightly).
[Zhang et al., 1997]
Indirect effect: create and reinforce political constituency for tobacco in Congress
Blocks federal tobacco control policies.
Thereby increases smoking.
Cigarette advertising and promotion have no effect on the amount of smoking. Their only function, and impact, is to permit the companies to vie for shares of a market of fixed size.
Brand-share argument runs contrary to much empirical evidence and makes no sense.
Especially in a highly concentrated market, as in the U.S., much brand-share marketing merely cannibalizes a company’s own brands (e.g., Philip Morris controls half the market).
If the industry truly believed its own argument, it would have leapt at opportunities to ban ads.
In the U.S., it would save > $10 billion/year.
Cigarette advertising and promotion constitute one of the principal direct determinants of smoking, especially initiation of smoking by children.
Advertising and promotion (A/P) likely do increase smoking, including encouraging experimentation by kids.
No evidence points to A/P as a principal direct determinant of smoking, however.
Peer and parental behavior and role modeling by music and movie stars likely more important.
A/P may increase smoking through indirect mechanisms, as well as direct.
E.g., media dependence on tobacco company ad revenues discourages coverage of the importance of smoking in disease. [Warner et al., New Engl. J. Med., 1992]
A complete ban on A/P would be expected to decrease smoking by about 7%.[Saffer and Chaloupka, Journal of Health Economics, 2000]
The tobacco companies have moved into developing countries in recent years to compensate for declining markets in affluent nations. Tobacco control progress in rich countries will come at the price of increasingly aggressive invasion of poor countries by the multinational tobacco companies.
Multinationals have moved into developing countries, but not because other markets are declining.
They see a market expansion opportunity in developing countries, due to
growing affluence in those countries;
reductions in trade restrictions; and
bulging treasuries the companies want to invest profitably.
Recent movement into developing countries would have occurred even if sales were not falling in developed countries.
…is measured not in dollars and cents, but rather in the grief of injured smokers and their loved ones.