Belmont University Research Symposium (BURS)

Taxation on Human Behavior

Publication Date

2024

College

Business, Jack C. Massey College of

Department

Economics and Finance

BURS Faculty Advisor

Dustin Rumbaugh

Presentation Type

Oral Presentation

Abstract

Since 1969 all fifty (50) states have implemented taxes on cigarettes at various levels. States seek tax revenue to address the increasing cost of cigarette related health issues. Depending on the elasticity of the cost of cigarettes the tax amounts could cause consumers to seek substitutes. My investigation is focused on the role of cigarettes and their taxes on alcohol consumption. To study this concept I pulled data on cigarette consumption per day per person as well as the number of days per week an individual consumed alcohol from the Behavioral Risk Factor Surveillance System (CDC) for the year 2021. I also pulled cigarette tax rates by state for the corresponding year from the Tax Foundation.To carry out my analysis I used Stata, which is a statistical software analysis tool, through which I will run regressions using an instrument variable to visualize the correlation factor between cigarette taxes and alcohol consumption. Whether or not a correlation is found, this research is aimed to clarify the role of cigarette taxations impact on other consumptions such as alcohol.

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