Prices and cross-border cigarette purchases in the EU: evidence from demand modelling

Author:

Stoklosa MichalORCID

Abstract

BackgroundPrevious studies of cross-border cigarette purchases in the European Union (EU) relied on survey-reported data. Results of those studies might be affected by under-reporting of tax avoidance in those surveys. This study aims to shed light on the effects of cigarette price differences between EU Member States on cross-border cigarette purchases using a method that is free from potential reporting bias.Data and methods2004–2017 pooled time-series data and econometric modelling are used to examine cross-border shopping in the EU. Incentives for cross-border shopping are measured as a function of differences in cigarette prices between bordering countries, controlling for population density near borders. Separate incentive variables are calculated for EU internal versus EU external borders and for terrestrial versus maritime borders. Tax-paid cigarette sales are modelled as a function of cigarette price, per capita income, non-price measures and the incentive variables using fixed-effects models.ResultsThe estimated price elasticity of cigarette demand varies, depending on the model, from −0.47 to −0.35. The estimated income elasticity varies from 0.66 to 0.70. Between-country price differences are not significantly associated with purchases across maritime borders and across borders with non-EU neighbours. In an average EU Member State, reducing incentives from cross-border shopping down to zero would increase sales by 1.5% in an importing country and reduce sales by about 6% in an exporting country, ceteris paribus.ConclusionAn upward convergence of cigarette prices across EU Member States would reduce cross-border cigarette purchasing and improve public health by contributing to decreases in cigarette consumption.

Publisher

BMJ

Subject

Public Health, Environmental and Occupational Health,Health (social science)

Reference36 articles.

1. The Council of the European Union. Council Directive 2011/64/EU of 21 June 2011 on the structure and rates of excise duty applied to manufactured tobacco (codification). 2011 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2011:176:0024:0036:EN:PDF

2. Lessons learned from cigarette tax harmonisation in the European Union

3. Bouw A . Tobacco taxation in the European Union: an overview. Washington DC: World Bank Group, 2017.

4. Price and cigarette consumption in Europe

5. Stener Pedersen H , Floristean A , Iseppi L , et al . Study on the measuring and reducing of administrative costs for economic operators and tax authorities and obtaining in parallel a higher level of compliance and security in imposing excise duties on tobacco products. Ramboll: The Evaluation Partnership, Europe Economics, 2014.

同舟云学术

1.学者识别学者识别

2.学术分析学术分析

3.人才评估人才评估

"同舟云学术"是以全球学者为主线,采集、加工和组织学术论文而形成的新型学术文献查询和分析系统,可以对全球学者进行文献检索和人才价值评估。用户可以通过关注某些学科领域的顶尖人物而持续追踪该领域的学科进展和研究前沿。经过近期的数据扩容,当前同舟云学术共收录了国内外主流学术期刊6万余种,收集的期刊论文及会议论文总量共计约1.5亿篇,并以每天添加12000余篇中外论文的速度递增。我们也可以为用户提供个性化、定制化的学者数据。欢迎来电咨询!咨询电话:010-8811{复制后删除}0370

www.globalauthorid.com

TOP

Copyright © 2019-2024 北京同舟云网络信息技术有限公司
京公网安备11010802033243号  京ICP备18003416号-3