Postprint version. Published in Applied Economics Letters, Volume 18, Issue 8, January 24, 2011, pages 723-728.
The definitive version is available at https://doi.org/10.1080/13504851.2010.498339.
Although tobacco-control spending is considered an essential component of comprehensive programmes aimed at lowering smoking, substantial variation exists across states. This article examines if variation is systematically related to cross-state differences in smoking prevalence, holding other factors constant that are expected to influence spending. An econometric model is estimated which considers effects of tobacco-settlement revenues, income, unemployment, political party of the governor, state debt and smoking prevalence on tobacco-control spending in all states during 2000--2007. Estimations control for the possibility that spending and smoking prevalence are co-determined to clearly determine the causal link from prevalence to spending. Spending variation is determined to be inconsistent with a 'rational needs' strategy whereby states with higher prevalence choose more funding than states with lower prevalence. This empirical result is consistent with recent studies indicating that spending on tobacco control exerts little to no effect on cigarette sales or smoking prevalence.
2011 Taylor & Francis.
This is an electronic version of an article published in Applied Economics Letters.