Impact of Tobacco Control Policies on Cigarette Consumption in Malaysia
DOI:
https://doi.org/10.33736/ijbs.5199.2022Keywords:
Tobacco Control Policy, Fully Modified Ordinary Least Square, Elasticity of DemandAbstract
Raising the cigarettes price is an important measure to reduce the consumption of cigarettes and smoking rate. Besides price, other measures of tobacco control policies also play essential roles in determining the demand for cigarettes in Malaysia. In this study, the impact of tobacco control policies on consumption of cigarettes was examined using the fully modified ordinary least squares (FMOLS) technique. The study found that higher cigarettes price due to excise tax significantly decreased consumption of cigarette in the long run. An increase of 10% in the price of cigarettes reduces 7.69% of its consumption. Other measures of tobacco control policies except the “Tak Nak” campaign were also found to have reduced the consumption of cigarette significantly. The study concludes that the effective ways of reducing the use of cigarettes are by increasing the cigarette tax and strengthening the enforcement of other tobacco policies measures.
References
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Bishop, J. A., Liu, H., & Meng, Q. (2007). Are Chinese smokers sensitive to price?. China Economic Review, 18(2), 113-121. https://doi.org/10.1016/j.chieco.2006.12.001
Borland, R., Yong, H. H., Wilson, N., Fong, G. T., Hammond, D., Cummings, K. M., Hosking, W., & McNeill, A. (2009). How reactions to cigarette packet health warnings influence quitting: Findings from the ITC four-country survey. Addiction, 104(4), 669-675. https://doi.org/10.1111/j.1360-0443.2009.02508.x
Chaloupka, F. J., Yurekli, A., & Fong, G. T. (2012). Tobacco taxes as a tobacco control strategy. Tobacco Control, 21(2), 172-180. https://doi.org/10.1136/tobaccocontrol-2011-050417
Dickey, D. A., & Fuller, W. A. (1979). Distribution of the estimators for autoregressive time series with a unit root. Journal of the American Statistical Association, 74(4), 427-431. https://doi.org/10.1080/01621459.1979.10482531
Dickey, D. A., & Fuller, W. A. (1981). Likelihood ratio statistics for autoregressive time series with a unit root. Econometrica, 49(4), 1057-1072. https://doi.org/10.2307/1912517
Hammond, D., Fong, G. T., Cummings, K. M., & Hyland, A. (2005). Smoking topography, brand switching, and nicotine delivery: Results from an in vivo study. Cancer Epidemiology Biomarkers and Prevention, 14(6), 1370-1375. https://doi.org/10.1158/1055-9965.EPI-04-0498
Institute for Public Health. (2020). National health and morbidity survey (NHMS) 2019: Non-communicable diseases, healthcare demand, and health literacy - Key findings. National Institute of Health, Ministry of Health. https://iptk.moh.gov.my/images/technical_report/2020/4_Infographic_Booklet_NHMS_2019_-_English.pdf
John, R. M. (2008). Price elasticity estimates for tobacco and other addictive goods in India. Health Policy and Planning, 23(3), 200-209. https://doi.org/10.1093/heapol/czn007
Levy, D. T., Currie, L., & Clancy, L. (2013). Tobacco control policy in the UK: Blueprint for the rest of Europe?. European Journal of Public Health, 23(2), 201-206. https://doi.org/10.1093/eurpub/cks090
Levy, D. T., & Friend, K. (2001). A computer simulation model of mass media interventions directed at tobacco use. Preventive Medicine, 32(3), 284-294. https://doi.org/10.1006/pmed.2000.0808
Li, J. & Grigg, M. (2009). New Zealand: New graphic warnings encourage registrations with the quitline. Tobacco Control, 18(1), 72-72. https://doi.org/10.1136/tc.2008.027649
MacKinnon, J. G. (1996). Numerical distribution functions for unit root and cointegration tests. Journal of Applied Econometric, 11(6), 601-618. https://doi.org/10.1002/(SICI)1099-1255(199611)11:6<601::AID-JAE417>3.0.CO;2-T
MOH. (2016). The Relationships between tobacco taxation and demand determinants to reduce cigarettes consumption and smoking prevalence in Malaysia. Ministry of Health, Malaysia.
MOH. (2017). Annual Report Ministry of Health Malaysia 2017. Ministry of Health Malaysia. https://www.moh.gov.my/moh/resources/Penerbitan/Penerbitan%20Utama/Annual%20Report%20MoH%202017.pdf
Norashidah, M. N., Nik Mustapha, R. A., & Mastura, Y. (2013). Cigarettes demand and tax strategy in Malaysia. Pertanika Journal of Social Science and Humanities, 21(S), 99-114. http://psasir.upm.edu.my/id/eprint/30860/1/Cigarettes%20Demand%20and%20Tax%20Strategy%20in%20Malaysia.pdf
Phillips, P. C. B., & Hansen, B. E. (1990). Statistical inference in instrumental variables regression with I(1) processes. The Review of Economic Studies, 57(1), 99-125. https://doi.org/10.2307/2297545
Phillips, P. C. B., & Perron, P. (1988). Testing for a unit root in time series regression. Biometrika, 75(2), 335-346. https://doi.org/10.1093/biomet/75.2.335
Ross, H., & Al-Sadat, N. (2007). Demand analysis of tobacco consumption in Malaysia. Nicotine and Tobacco Research, 9(11), 1163-1169. https://doi.org/10.1080/14622200701648433
Tan, Q. Y., Zomer, E., Owen, A. J., Chin, K. L., & Liew, D. (2019). Impact of tobacco use on health and work productivity in Malaysia. Tobacco control, 1-7. http://dx.doi.org/10.1136/tobaccocontrol-2018-054677
Thrasher, J. F., Hammond, D., Fong, G. T., & Arillo-Santillán, E. (2007). Smokers' reactions to cigarette package warnings with graphic imagery and with only text: A comparison between Mexico and Canada. Salud Publica de Mexico, 49(S2), 233-240. https://doi.org/10.1590/S0036-36342007000800013
Townsend, J., Roderick, P., & Cooper, J. (1994). Cigarette smoking by socioeconomic group, sex, and age: effects of price, income, and health publicity. BMJ, 309, 923-927. https://doi.org/10.1136/bmj.309.6959.923
WHO. (2011). WHO report on the global tobacco epidemic, 2011: Warning about the dangers of tobacco. World Health Organization. https://apps.who.int/iris/handle/10665/44616
WHO. (2013). WHO report on the global tobacco epidemic, 2013: Enforcing bans on tobacco advertising, promotion and sponsorship. World Health Organization. https://apps.who.int/iris/bitstream/handle/10665/85380/9789241505871_eng.pdf?sequence=1
WHO. (2015). WHO report on the global tobacco epidemic, 2015: Raising taxes on tobacco. World Health Organization. https://apps.who.int/iris/handle/10665/178574
WHO. (2019). WHO report on the global tobacco epidemic, 2019: Offer help to quit tobacco use. World Health Organization. https://www.who.int/publications/i/item/9789241516204Arumugam, T (2017, May 14). Government to stub out tobacco use by raising taxes further. News Strait Times. https://www.nst.com.my/news/exclusive/2017/05/238983/government-stub-out-tobacco-use-raising-taxes-further.
Bishop, J. A., Liu, H., & Meng, Q. (2007). Are Chinese smokers sensitive to price?. China Economic Review, 18(2), 113-121. https://doi.org/10.1016/j.chieco.2006.12.001
Borland, R., Yong, H. H., Wilson, N., Fong, G. T., Hammond, D., Cummings, K. M., Hosking, W., & McNeill, A. (2009). How reactions to cigarette packet health warnings influence quitting: Findings from the ITC four-country survey. Addiction, 104(4), 669-675. https://doi.org/10.1111/j.1360-0443.2009.02508.x
Chaloupka, F. J., Yurekli, A., & Fong, G. T. (2012). Tobacco taxes as a tobacco control strategy. Tobacco Control, 21(2), 172-180. https://doi.org/10.1136/tobaccocontrol-2011-050417
Dickey, D. A., & Fuller, W. A. (1979). Distribution of the estimators for autoregressive time series with a unit root. Journal of the American Statistical Association, 74(4), 427-431. https://doi.org/10.1080/01621459.1979.10482531
Dickey, D. A., & Fuller, W. A. (1981). Likelihood ratio statistics for autoregressive time series with a unit root. Econometrica, 49(4), 1057-1072. https://doi.org/10.2307/1912517
Hammond, D., Fong, G. T., Cummings, K. M., & Hyland, A. (2005). Smoking topography, brand switching, and nicotine delivery: Results from an in vivo study. Cancer Epidemiology Biomarkers and Prevention, 14(6), 1370-1375. https://doi.org/10.1158/1055-9965.EPI-04-0498
Institute for Public Health. (2020). National health and morbidity survey (NHMS) 2019: Non-communicable diseases, healthcare demand, and health literacy - Key findings. National Institute of Health, Ministry of Health. https://iptk.moh.gov.my/images/technical_report/2020/4_Infographic_Booklet_NHMS_2019_-_English.pdf
John, R. M. (2008). Price elasticity estimates for tobacco and other addictive goods in India. Health Policy and Planning, 23(3), 200-209. https://doi.org/10.1093/heapol/czn007
Levy, D. T., Currie, L., & Clancy, L. (2013). Tobacco control policy in the UK: Blueprint for the rest of Europe?. European Journal of Public Health, 23(2), 201-206. https://doi.org/10.1093/eurpub/cks090
Levy, D. T., & Friend, K. (2001). A computer simulation model of mass media interventions directed at tobacco use. Preventive Medicine, 32(3), 284-294. https://doi.org/10.1006/pmed.2000.0808
Li, J. & Grigg, M. (2009). New Zealand: New graphic warnings encourage registrations with the quitline. Tobacco Control, 18(1), 72-72. https://doi.org/10.1136/tc.2008.027649
MacKinnon, J. G. (1996). Numerical distribution functions for unit root and cointegration tests. Journal of Applied Econometric, 11(6), 601-618. https://doi.org/10.1002/(SICI)1099-1255(199611)11:6<601::AID-JAE417>3.0.CO;2-T
MOH. (2016). The Relationships between tobacco taxation and demand determinants to reduce cigarettes consumption and smoking prevalence in Malaysia. Ministry of Health, Malaysia.
MOH. (2017). Annual Report Ministry of Health Malaysia 2017. Ministry of Health Malaysia. https://www.moh.gov.my/moh/resources/Penerbitan/Penerbitan%20Utama/Annual%20Report%20MoH%202017.pdf
Norashidah, M. N., Nik Mustapha, R. A., & Mastura, Y. (2013). Cigarettes demand and tax strategy in Malaysia. Pertanika Journal of Social Science and Humanities, 21(S), 99-114. http://psasir.upm.edu.my/id/eprint/30860/1/Cigarettes%20Demand%20and%20Tax%20Strategy%20in%20Malaysia.pdf
Phillips, P. C. B., & Hansen, B. E. (1990). Statistical inference in instrumental variables regression with I(1) processes. The Review of Economic Studies, 57(1), 99-125. https://doi.org/10.2307/2297545
Phillips, P. C. B., & Perron, P. (1988). Testing for a unit root in time series regression. Biometrika, 75(2), 335-346. https://doi.org/10.1093/biomet/75.2.335
Ross, H., & Al-Sadat, N. (2007). Demand analysis of tobacco consumption in Malaysia. Nicotine and Tobacco Research, 9(11), 1163-1169. https://doi.org/10.1080/14622200701648433
Tan, Q. Y., Zomer, E., Owen, A. J., Chin, K. L., & Liew, D. (2019). Impact of tobacco use on health and work productivity in Malaysia. Tobacco control, 1-7. http://dx.doi.org/10.1136/tobaccocontrol-2018-054677
Thrasher, J. F., Hammond, D., Fong, G. T., & Arillo-Santillán, E. (2007). Smokers' reactions to cigarette package warnings with graphic imagery and with only text: A comparison between Mexico and Canada. Salud Publica de Mexico, 49(S2), 233-240. https://doi.org/10.1590/S0036-36342007000800013
Townsend, J., Roderick, P., & Cooper, J. (1994). Cigarette smoking by socioeconomic group, sex, and age: effects of price, income, and health publicity. BMJ, 309, 923-927. https://doi.org/10.1136/bmj.309.6959.923
WHO. (2011). WHO report on the global tobacco epidemic, 2011: Warning about the dangers of tobacco. World Health Organization. https://apps.who.int/iris/handle/10665/44616
WHO. (2013). WHO report on the global tobacco epidemic, 2013: Enforcing bans on tobacco advertising, promotion and sponsorship. World Health Organization. https://apps.who.int/iris/bitstream/handle/10665/85380/9789241505871_eng.pdf?sequence=1
WHO. (2015). WHO report on the global tobacco epidemic, 2015: Raising taxes on tobacco. World Health Organization. https://apps.who.int/iris/handle/10665/178574
WHO. (2019). WHO report on the global tobacco epidemic, 2019: Offer help to quit tobacco use. World Health Organization. https://www.who.int/publications/i/item/9789241516204
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