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The sale was valued at approximately $740 million. According to Nobel Prize-successful economist Gary Becker, who has studied the long-run worth elasticity of cigarettes, the tax improve as a result of the Children’s Health insurance Program Reauthorization Act will increase the value of cigarettes 13.3% which ultimately means a 10.6% decrease in unit gross sales. The enhance was to assist cover the price of elevated protection below the State Children’s Health Insurance Program (SCHIP).
Therefore, utilizing coverage variation is an improvement over a lot of the current e-cigarette research thus far that fails to separate the causal effect of e-cigarette use from preferences to gradually increase the riskiness of tobacco product use over time. This contrasts with much of the literature not using coverage variation and spuriously concluding that e-cigarettes are gateways to subsequent cigarette use, which does not align with observed patterns of tobacco use.
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