Quarterly data of magazine circulation are used to analyse the consumption behaviour of the readers of German popular magazines in a panel framework using OLS,2SLS and generalized method of moments techniques,in order to test the rational addiction hypothesis in respect with goods without any...

The costs associated with unhealthy food consumption are not only paid by those suffering from overweight but by all members of society in terms of higher costs for social security systems. With this in mind, we study the effectiveness of a tax, a subsidy and cash incentives in reducing...

This paper studies the demand for tobacco products in post-unification Italy. We construct a very detailed panel dataset of yearly consumption in the 69 Italian provinces from 1871 to 1913, and use it to estimate the Becker and Murphy (1988) rational addiction model. We find support for the...

In this paper we embed the Almost Ideal Demand System within a dynamic disequilibrium model, and derive a set of interrelated Euler equations which characterizes optimal consumption allocations under adjustment costs. It is argued that when applied to alcohol and tobacco expenditure, the...

This paper investigates the large and unexpected increase in cigarette prices that followed the 1997 Master Settlement Agreement (MSA). We integrate key features of rational addiction theory into a discrete-choice model of the demand for a differentiated product. We find that following the MSA...

The seminal paper by Becker and Murphy (1988) proposed a model acknowledging both addiction and rationality in the consumption of addictive goods. We extend this rational addiction model to include two addictive consumption goods, where the goods may be substitutes or complements, and may...

Quarterly data of magazine circulation are used to analyse the consumption behaviour of the readers of German popular magazines in a panel framework using OLS, 2SLS and generalized method of moments techniques, in order to test the rational addiction hypothesis in respect with goods without any...