Cigarette Tax Hikes Affect Alcohol Consumption

Article excerpt

DENVER -- Raising cigarette taxes has the unwanted effect of increasing alcohol consumption, including binge and heavy drinking.

This relationship is an example of what economists call a cross-price or substitution effect. And it's something about which policy makers need to be cognizant, Deborah L. McLellan said at the meeting.

She analyzed 6 years of cross-sectional data from the Centers for Disease Control and Prevention's annual Behavioral Risk Factor Surveillance System surveys carried out in 2001-2006. Interviews were conducted with 1,323,758 adults living in nearly every state in the country.

Her multivariate logistic regression analysis concluded that for every $1 increase in the price of a pack of cigarettes, the ranks of current smokers drop by a highly significant 5%. That's consistent with the classic economic theory of consumer demand, which holds that raising the price of a commodity decreases consumption.

But the analysis also showed that a $1-per-pack price increase was associated with a 29% increase in the odds of having consumed alcohol during the last month, a 12% increase in binge drinking, and a 10% increase in heavy drinking, defined in the study as more than one drink/day in women and more than two in men.

"I want to be clear that the message here is not 'Let's stop increasing cigarette taxes. …