Despite the recent declines in smoking among high school students detected by the Monitoring the Future (MTF) surveys, the 30-day prevalence rate in 2002 remains high: 10.7% for 8th-graders, 17.7% for 10th-graders, and 26.7% for 12th-graders. Cigarette smoking among adolescents is of particular concern to public policy makers. More than 2,000 American youth become addicted to tobacco each day, and one-third of these will die prematurely from smoking-related diseases (CDC, 1996). Cigarette smoking is the leading cause of preventable death and disease in the United States (U.S. Department of Health and Human Services [DHHS], 1989). Smoking accounts for the majority of lung cancer cases, and it is an important risk factor for cardiovascular disease (U.S. DHHS, 1988). In addition, a recent panel of experts concluded that smoking is even more deleterious than previously thought, for both smokers and those exposed to environmental tobacco smoke, causing cancer in many more organs of the body than previously believed (IARC, 2002). Furthermore, many youth underestimate the risk of addiction and the health consequences of smoking (Johnston et al., 2001; Kessler, 1995; U.S. DHHS, 1994).
Even though some states have implemented comprehensive tobacco strategies consistent with the guidelines recommended by the Centers for Disease Control and Prevention (CDC), the majority of states are lagging behind. The current budget crises are causing some states to reconsider their spending on tobacco control. Given these circumstances, it is even more important to identify the most effective measures to reduce youth smoking.
It is essential to gain a better understanding of how economic factors, such as price, affect youth smoking behavior. This knowledge will facilitate the design of optimal tobacco control strategies. The Healthy People 2010 initiative set a goal to reduce the prevalence of adolescent cigarette smoking in America to 16% by 2010. Although preventing youth and young adults from initiating smoking is an extremely important approach to tobacco control, according to the 1990 Surgeon General's report (U.S. DHHS, 1990), smoking cessation represents the single most important step that smokers can take to enhance the quality and length of their lives.
Studies of youth smoking behavior suggest that many teen smokers are motivated to quit smoking. It has been estimated that 74% of occasional teen smokers and 65% of daily teen smokers have a desire to quit, although there is evidence that the success rate among those who do attempt to quit is low (Lamkin et al., 1998; Stone and Kristeller, 1992). An important conclusion of several studies of adolescent smoking is that it is essential to intervene to keep occasional smokers from becoming daily smokers. Yet many adolescents are unfamiliar with the tools or methods that support quit attempts (Balch, 1998). In addition, the majority of formal smoking cessation programs are aimed exclusively at adults. Given the cost-effectiveness of smoking cessation interventions for adults, and the large number of addicted teenagers, research on cessation programs tailored to youth should be a high priority (Cromwell et al., 1997; Warner, 1997).
The survey data used in this article provide a unique opportunity to gain insight into whether and to what extent cigarette prices motivate smoking cessation among high school students by examining the strength of the reaction to proposed price increases of various magnitudes. The data are also suitable for analysis of the compensatory behavior triggered by cigarette price changes. Improved knowledge in this area can be directly translated into public policies aimed at curbing youth smoking, such as the availability of youth cessation services and regulations directed at compensatory behavior. The study further addresses questions related to the design of optimal tax policies. Public policy makers often debate whether to enact a series of incremental tax increases or to jump directly to the target tax level. …