Demand Reduction from Plain and Pictorial Cigarette Warning Labels: Evidence from Experimental Auctions
By Matthew C. Rousu and James F. Thrasher
Published in Applied Economic Perspectives and Policy. Volume 35, Issue 1. Pages 171-184.
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Abstract: We report the results of experimental auctions with U.S. smokers, assessing the percentage of U.S. smokers whose demand for cigarettes decreases when bidding on packs with text and pictorial warnings, relative to packs with text-only warnings. We find that pictorial labels and pictorial labels accompanied by plain packaging are more effective at reducing demand for cigarettes than only a front text warning label. We also find that pictorial labels were most effective at encouraging younger smokers to reduce their demand for cigarettes, and plain packaging was most effective at reducing demand among less educated smokers.