World Economics - Insight , Analysis and Data

World Economics - Insight , Analysis and Data
Regulating Tobacco in the United States
Jonathan Gruber
World Economics, September 2002

There has been a dramatic turn of events against the tobacco industry in the past few years, raising the question of the appropriate future path for smoking policy in the US. This paper discusses the theory and evidence on regulation of smoking. The author begins by reviewing the background on this industry. He then turns to a discussion of the motivations for regulating smoking. He argues that the available evidence suggests that we move from the traditional model, which ties regulation to costs external to the smoker, to a new framework where regulation is related to the internal costs of smoking (the damage the smoker does to him- or herself). The paper reviews the evidence on the effects of existing regulations. It concludes with a discussion of future policy directions.
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