Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/110165
Authors: 
Rozema, Kyle
Ziebarth, Nicolas R.
Year of Publication: 
2015
Series/Report no.: 
IZA Discussion Papers 8907
Abstract: 
This paper investigates a previously unexplored behavioral response to taxation: whether smokers compensate for higher cigarette taxes by enrolling in food stamps. First, we show theoretically that increases in cigarette taxes can induce food stamp take-up of non-enrolled, eligible smoking households. Then, we study the theoretical predictions empirically by exploiting between and within-household variation in food stamp enrollment from the Current Population Survey as well as data from the Consumer Expenditure Survey. The empirical evidence strongly supports the model predictions. Higher cigarette taxes increase the probability that low-income smoking households take-up food stamps.
Subjects: 
cigarette taxes
food stamp take-up
tax pass-through rate
unintended consequences
JEL: 
L66
H21
H23
H26
H71
I18
Document Type: 
Working Paper

Files in This Item:
File
Size
1.73 MB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.