April 5, 2018

Stanton A. Glantz, PhD

Users of non-cigarette tobacco products are price sensitive, too

Mohammed Jawad , several other colleagues, and I recently published “Price elasticity of demand of non-cigarette tobacco products: a systematic review and meta-analysis” in Tobacco Control.  Most studies of the effects of price on tobacco consumption deal with cigarettes.  This paper identified studies of the effect of price on consumption on non-cigarette tobacco products and found, like with cigarettes (and most things) raising price is associated with lower consumption.  The level of price sensitivity (elasticity) is around the same level as cigarettes.  If anything, users of non-cigarette tobacco products are more price sensitive (higher elasticity) than cigarette smokers. 

The policy implication of this work is that tax increases (to increase price and reduce consumption) is good public health policy for nonsmoked tobacco products, too.

Objective To systematically review the price elasticity of demand of non-cigarette tobacco products. Data sources Medline, Embase, EconLit and the Web of Science without language or time restrictions.

Study selection Two reviewers screened title and abstracts, then full texts, independently and in duplicate. We based eligibility criteria on study design (interventional or observational), population (individuals or communities without geographic restrictions), intervention (price change) and outcome (change in demand).

Data extraction We abstracted data on study features, outcome measures, statistical approach, and single best own- and cross-price elasticity estimates with respect to cigarettes. We conducted a random effects meta-analysis for estimates of similar product, outcome and country income level. For other studies we reported median elasticities by product and country income level.

Data synthesis We analysed 36 studies from 15 countries yielding 125 elasticity estimates. A 10% price increase would reduce demand by: 8.3% for cigars (95% CI 2.9 to 13.8), 6.4% for roll your owns (95% CI 4.3 to 8.4), 5.7% for bidis (95% CI 4.3 to 7.1) and 2.1% for smokeless tobacco (95% CI −0.6 to 4.8).  Median price elasticities for all ten products were also negative. Results from few studies that examined cross-price elasticity suggested a positive substitution effect between cigarette and non-cigarette tobacco products.

Conclusions There is sufficient evidence in support of the effectiveness of price increases to reduce consumption of non-cigarette tobacco products as it is for cigarettes. Positive substitutability between cigarette and non-cigarette tobacco products suggest that tax and price increases need to be simultaneous and comparable across all tobacco products.

The full citation is Jawad M, Lee JT, Glantz S, et al. Tob Control Epub ahead of print: [please include Day Month Year]. doi:10.1136/tobaccocontrol-2017-054056  Tob Control. 2018 Jan 23. pii: tobaccocontrol-2017-054056. doi: 10.1136/tobaccocontrol-2017-054056. [Epub ahead of print]; it is available here

Comments

Comment: 

We are all price sensitive. But considering that the only demographics that use these "non-cigarette tobacco products" are current or former smokers we need to maintain reduced risk products at lower prices than cigarettes so switching is enticing. Raising the prices of non combustible nicotine products to mirror cigarettes just keeps people smoking.

Comment: 

This is certainly one argument that people make.  It ignores the gateway affect of these products as well as the fact that their use is associated with smoking relapse as well as high levels of dual use

Comment: 

As long as e-cigarettes are keeping people smoking, a result of keeping them cheap is keeping more people smoking.

Just as e-cigarettes provide cigarette companies a way around smokefree policies that help reduce smoking, they provide way around cigarette taxes that help reduce smoking. You don't have to quit smoking! Just use this other product at places you don't smoke, or at times you don't have the cash. Then you can smoke later.

And as long as e-cigarettes are a path for kids to smoking, a result of cheap e-cigarettes is uptake by kids and more later smoking. A key benefit of higher cigarette taxes is reducing kids who get addicted to nicotine. Cheap e-cigarettes are an end run around that, an on-ramp to smoking.

Of course, this is all great for the cigarette companies. Which is probably why they fight against taxes on e-cigarettes. If they really believed e-cigarettes were snuffing out smoking, they'd be fighting for taxes on e-cigarettes, they'd be fighting to make e-cigarette taxes as high as possible.

Comment: 

Posting to Tobacco Control's Rapid Response forum.

Stan - I hope you will take advantage of TC's RR forum to continue this discussion, per the editors "Blog Fog" request (http://tobaccocontrol.bmj.com/content/26/2/121).

Here's our response to the paper:
http://tobaccocontrol.bmj.com/content/early/2018/01/23/tobaccocontrol-20...

Thank you.

Joe

PS - I really like the "preview" functionality of your new blog!!

Financial and Non-Financial Disclosures

Financial: I provide consulting services to Reynolds American, Inc., on tobacco harm reduction, and I also own an interest in a nicotine gum that has not been developed nor commercialized.

Non-financial:
o I have no formal technical training and I am rarely overburdened by too much knowledge—but I am very curious.
o My priors in the area of nicotine include:
 The health risks of nicotine use arise almost entirely from delivery contaminants and route of administration.
 Nicotine delivery, alone, particularly buccally, is not associated with health consequences that would be of public health significance.
 While FDA regulation is still untested in many ways, the authorities and resources available to FDA give me considerable comfort that while fears of “another low-tar experience” are understandable they should not be given much salience.
 The policy, regulatory, and communications opportunities to leverage the relative risk across nicotine products are far and away the most promising way to reduce preventable, premature, suffering and death rapidly.

Comment: 

The reason that we did not report to this comment when it was originally posted on the Tobacco Control rapid response section was that it is off the subject of the paper, which was to estimate the price elasticities of non-cigarette tobacco products, not a discussion of the pros and cons of the differential tax policies being encouraged by the tobacco companies and people who think that these non-cigarette products have a role in tobacco harm reduction.

I remain deeply skeptical that the companies who created and maintain the tobacco epidemic can be trusted to reduce it and more than we can depend on drug cartels to solve the illegal drug problem.

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