The efficacy of state-level antismoking laws: Demand and supply considerations

Abstract

Utilizing published ratings of state-level antismoking laws, this paper addresses the merits of limits to smoking in public places and restrictions on youth access to tobacco. Consistent with the literature, we find that clean indoor-air laws reduce demand. However, by failing to address supply considerations, the literature to date presents a biased reaction of consumption to anti-smoking laws. Indeed, we find that clean indoor-air laws also intensify competition, which suggests that producers mitigate demand reductions by lowering price. Nonetheless, restrictions to youth access, as well as enforcement and penalty efforts, have little impact on cigarette consumption across states.