The Economics of Smoking Bans

While the empirical literature on smoking bans is extensive, little theory has been developed. This paper examines the welfare impact of smoking bans in an economy where smokers’ utility is reduced by a workplace/public place ban. The government has two instruments - increasing the price through taxation, or limiting when the product can be consumed through a ban. Its ability to reduce smoking through taxation is limited by a black market where cigarettes are not taxed. We show that the quantity instrument (ban) is always welfareenhancing. The model has application to other addictive activities.smoking, workplace ban, public place ban, government control, taxation

Introducing the Peer Group Effect: Why Decentralization is Bad for Efficiency (But Good for Equity)

Peer Group, Decentralization, Voting, Second-Best Inefficiency, Equity

LOW INCOME HOUSING ASSISTANCE: THE EFFECT OF COMMUNITY COMPOSITION ON PUBLIC EXPENDITURES AND WELFARE

voting ; fiscal policy ; prices ; housing market

INTERPRETING "THE RAMSEY EQUATIONS" OF OPTIMAL TAX THEORY

fiscal policy ; social welfare ; economic models

THE INEQUITY OF AN EFFICIENT INDIRECT TAX STRUCTURE

household ; demand ; productivity ; social welfare

Which Tax Rate Do People Use: Average or Marginal?

Taxes ; income

Social Insurance and Population Uncertainty: Demographic Bias and Implications for Social Security

Population uncertainty, overlapping-generation model, demographics

Tax competition and the creation of redundant products

There are products that are assembled from kits but that, once assembled, are identical to other products. An example is the roll-your-own cigarette. Because the kit requires time to assemble, it is more costly than the assembled product; in the absence of tax competition, the kit is not bought or is `redundant.' I show that tax competition between regions supports strategies that tax the `redundant' product at a lower tax rate than its assembled counterpart, and it is bought. A welfare loss is thereby created.