Courtney Knapp has an interesting piece up on the new graphic images that will be added to cigarette packs in an effort to curb smoking.
These new labels will be required on all cigarette packs, cartons and ads no later than September 2012. So in the meantime, we have time for a thought experiment. Yesterday, Cheap Talk contributor and Northwestern University economics professor Jeffrey Ely posed an excellent question to me:
Suppose you had a choice between only two policies: A) grotesque pictures or B) increased per-pack taxes calculated to generate exactly the same reduction in demand. Which do you prefer?
This is a tough question. To me, as disturbing as the photos are, raising already regressive-taxes (assuming that current levels of taxes with discount rate already more than offset the costs to government of people smoking) is bad policy. Smokers may quit or not start, but without a larger revenue stream no new vested interests would be created. On the flip side, no revenue could possibly be earmarked for an agreeable cause.
What do you think, dear readers?
Which policy would you choose? Will the images deter nonsmokers?
Smokers, are the images likely to help you quit or will you acclimate to the images after a few packs? Would you pay more for a pack without the warnings?
I think it’s an interesting thought experiment: would consumers pay a higher price for non-labeled packs? I don’t know. As an ex-smoker, I suppose it’s more likely I’d pay for the cheaper pack and then put my cigarettes in a cigarette case. Maybe slap a picture of Camel Joe holding a bunny on it for good measure.
I think a better idea than simply raising taxes ad infinitum or shaming smokers with images of fetuses or whatever would be to legalize the sale of single-cigarettes at gas stations, bars and so forth. There is something really ridiculous about being forced to purchase cigarettes 20 at a time. It makes it much more difficult to quit. It also makes it easier to pick the habit back up if you have to buy a pack at a time.
As someone who has relapsed now and again, I know it would be much better if I could stave off a craving by purchasing a single smoke instead. I wouldn’t have that sense of obligation to clean my plate, as it were. I know a lot of people in similar circumstances.
Sometimes giving people more choices can be better than shaming them or taxing them.