Fewer American teens smoke cigarettes today than 20 years ago. And taxes on cigarettes are much higher, too. For a while, these two trends were related, because teens wouldn’t pay the high price of a pack, but not anymore. Young people are no longer responding to higher cigarette taxes by smoking less.
Some perspective is important: More than one in three teenagers smoked in 1997, but fewer than one in four did in 2013. And within the past decade, 31 states have jacked up their tax on cigarettes, especially after the Great Recession strained many governments’ budgets. Although reducing teen smoking often wasn’t the main justification for raising cigarette taxes, old research using data up to 2005 had shown that a $1-per-pack tax increase could reduce teen smoking by nearly 10 percent.
But new research, using updated data through 2013, suggests that the association between the price of cigarettes and youth smoking rates has become weaker in recent years. According to a new working paper, not yet peer-reviewed, a $1 increase in cigarette taxes from 2007 to 2013 was linked to a very slight increase in teen smoking (albeit one statistically indistinguishable from zero). The working paper was written by three economists, Benjamin Hansen, Joseph Sabia and Daniel Rees, and was published by the National Bureau of Economic Research.
There are several possible reasons why taxes no longer affect teen smokers. Nowadays, “the only remaining smokers are the die-hards,” said Kitt Carpenter, an economist at Vanderbilt University. Smoking among young people has fallen so far that the remaining core isn’t affected by price.
Another possibility, raised by Hansen and his collaborators, is that teens are more adept at using the Internet to evade cigarette taxes. Other research has shown that online searches for “cheap cigarettes” spike when new taxes are implemented. High schoolers, either through social connections or online vendors, might be better at getting those less-expensive smokes, thereby nullifying the tax hike.
In 2008, with co-author Philip Cook, Carpenter published work showing that cigarette taxes discourage teen smoking. It was the strongest study to date, but it used data through only 2005. Although the new research replicates Carpenter and Cook’s estimates through 2005, the relationship breaks down in the subsequent period through 2013. Carpenter supports these new estimates: “I think it’s interesting, and the analysis seems right,” he said.
Both studies used data from the Youth Risk Behavior Surveys (YRBS), a massive biennial effort that surveys thousands of high schoolers. Directed by the Centers for Disease Control and Prevention (CDC) and state education departments, the surveys reached more than 150,000 high school students in 48 states from 1991 to 2013 and asked them about risky behavior such as smoking.
The 2007 to 2013 period is also interesting because, during the recession and slow recovery that followed, it became, in Hansen’s words, “smoking-tax-hike season” for many state governments. For instance, Massachusetts raised its tax by $1 in 2008, and Minnesota’s went up by $1.60 in 2013.
The trend isn’t uniform; states have different smoking and tax patterns. The states raising cigarette taxes are probably the ones with the greatest anti-smoking sentiment; politicians, after all, are probably raising cigarette taxes in accord with public opinion. But this sentiment is hard to observe directly, and so Hansen and his co-authors did extra work to analyze trends by controlling for state-level variables. When they did so, higher cigarette prices had no effect on teen smoking.
The YRBS data sets underpinning these studies are not perfect. They can’t survey youths who aren’t in school, and those who have dropped out might smoke more. Some researchers worry that high school students won’t answer about their smoking honestly in a school-administered survey. Both sets of researchers controlled for student demographic variables released by YRBS, such as race, sex, age and grade. Some variables — such as income — are not collected by the CDC or the states. Carpenter admitted that the information on the students is limited — “they are really, really poor measures,” he said. But it’s still the best data available to study this question.
It’s not clear what the policy response should be if this represents a new normal of youth smoking behavior. Hansen would like to see more research into the effectiveness of other anti-smoking interventions: high school health classes, for instance, or informational campaigns.
One option is to do what Hawaii recently did: raise the minimum smoking age. It’s 18 in most states, but Hawaii changed it to 21. Unfortunately, the YRBS doesn’t collect date of birth (only age). Hansen speculates that raising the minimum purchase age by just one year, from 18 years old to 19 years old, could have an impact on teen smoking. There are many high school seniors who are 18, but not many who are 19. Now that a previously effective weapon against teen smoking appears to be blunted, states will have to look elsewhere.