TY - JOUR
T1 - A survey of economic models of addictive behavior
AU - Grossman, Michael
AU - Chaloupka, Frank J.
AU - Anderson, Richard
PY - 1998
Y1 - 1998
N2 - In economic analyses of addictive behavior, the consumption of a certain good is termed to be an addiction if an increase in past consumption of the good leads to an increase in current consumption. From policy, legal, and public health perspectives, addictive goods are of interest because the consumption of many of these goods harms the consumer and others. The U.S. government and those of many other countries have chosen to regulate such addictive substances as cigarettes, alcohol, cocaine, and marijuana by means of policies that raise their prices. Consequently, the responsiveness of these substances to price is an important parameter in determining the optimal level of taxation or the impacts of legalization of cocaine or marijuana. The economics of addiction is very relevant to these issues because recent theoretical advances predict that addictive goods should be more sensitive to price than previously believed. Current empirical studies confirm this prediction.
AB - In economic analyses of addictive behavior, the consumption of a certain good is termed to be an addiction if an increase in past consumption of the good leads to an increase in current consumption. From policy, legal, and public health perspectives, addictive goods are of interest because the consumption of many of these goods harms the consumer and others. The U.S. government and those of many other countries have chosen to regulate such addictive substances as cigarettes, alcohol, cocaine, and marijuana by means of policies that raise their prices. Consequently, the responsiveness of these substances to price is an important parameter in determining the optimal level of taxation or the impacts of legalization of cocaine or marijuana. The economics of addiction is very relevant to these issues because recent theoretical advances predict that addictive goods should be more sensitive to price than previously believed. Current empirical studies confirm this prediction.
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U2 - 10.1177/002204269802800304
DO - 10.1177/002204269802800304
M3 - Review article
AN - SCOPUS:0031711745
SN - 0022-0426
VL - 28
SP - 631
EP - 643
JO - Journal of Drug Issues
JF - Journal of Drug Issues
IS - 3
ER -