Gender, Income Levels, and the Demand for Cigarettes

This paper uses data from the Current Population Survey to analyze determinants of cigarette demand. Price elasticities for smoking participation and quantity of cigarettes smoked are between y0.4 and y0.6 for both men and women. These effects diminish for high-income individuals. The family earnings elasticity of demand is weak, but education has strong negative effects on smoking, especially for high-income respondents. Own-earnings decrease individuals’ price sensitivity. Employment status is influential even after controlling for income, education, and other factors. The presence of young children reduces smoking, with the effect most pronounced for women.