In this paper we estimate the income elasticity of smoking. In contrast to previous research, we address the … econometric endogeneity of income as a determinant of smoking participation, cessation, and cigarette demand conditional upon … generated by changes in Federal and State Earned Income Tax Credit parameters. Using the IV strategy we find that smoking …

In this paper we estimate the causal income elasticity of smoking participation, cessation, and cigarette demand … conditional upon participation. Using an instrumental variables (IV) estimation strategy we find that smoking appears to be a … consumed and a decrease in smoking cessation. The magnitude and direction of the changes in the income coefficients from our …

for smoking participation and quantity of cigarettes smoked are between -0.4 and -0.6 for both men and women. These … negative effects on smoking, especially for high-income respondents. Own-earnings decrease individuals' price sensitivity … reduces smoking, with the effect most pronounced for women …