The authors would like to thank Vivienne Pham, Michelle Scollo and two anonymous referees for very helpful comments. Dr. Prentice did some of this work while visiting the University of Melbourne and Lehigh University and he is grateful for their hospitality.
Will Plain Packaging Reduce Cigarette Consumption?*
Article first published online: 13 SEP 2012
© 2012 The Economic Society of Australia
Economic Papers: A journal of applied economics and policy
Volume 31, Issue 3, pages 303–317, September 2012
How to Cite
Clarke, H. and Prentice, D. (2012), Will Plain Packaging Reduce Cigarette Consumption?. Economic Papers: A journal of applied economics and policy, 31: 303–317. doi: 10.1111/j.1759-3441.2012.00186.x
- Issue published online: 13 SEP 2012
- Article first published online: 13 SEP 2012
- plain packaging;
- cigarette industry;
- market structure
The Australian Parliament has passed legislation compelling tobacco products to be sold in “plain packaging.” This article reviews this legislation and its likely effects on prices, market structure in the tobacco industry and on smoking behaviour. Industry changes following two previous sets of restrictions on advertising are examined for relevant empirical evidence. Without offsetting tax increases, the legislation will plausibly reduce prices but significant entry into the industry and greater consumption of counterfeit/illegal cigarettes are unlikely. Provided that tax increases offset any induced fall in prices, plain packaging will reduce cigarette consumption.