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A Reduction In Consumer Expenditure On Cigarettes And Its Effects On Employment: A Case Study Of South Africa

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  • ROWENA VAN DER MERWE
  • IRAJ ABEDIAN

Abstract

This study estimates empirically the employment effects if stronger tobacco control policies result in reduced consumption in South Africa. Since 1995, the government has committed itself to a stronger tobacco control policy and increased excise taxes. Yet policy makers are sensitive to the need to pursue this public health policy in a way that will minimize job losses. This study uses input‐output methodology and four expenditure scenarios to estimate output and employment effects following such policies. The analysis suggests that net employment effects will be positive if consumption expenditure is switched from tobacco to other goods and services in the economy. Further, this study suggests that these policy implications for tobacco control and public health hold, if a country has a self‐sufficient industry like South Africa. (JEL 118, D57)

Suggested Citation

  • Rowena Van Der Merwe & Iraj Abedian, 1999. "A Reduction In Consumer Expenditure On Cigarettes And Its Effects On Employment: A Case Study Of South Africa," Contemporary Economic Policy, Western Economic Association International, vol. 17(3), pages 412-422, July.
    • Handle: RePEc:bla:coecpo:v:17:y:1999:i:3:p:412-422
    DOI: 10.1111/j.1465-7287.1999.tb00693.x
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    3. Chapman, S. & Richardson, J., 1990. "Tobacco excise and declining tobacco consumption: The case of Papua New Guinea," American Journal of Public Health, American Public Health Association, vol. 80(5), pages 537-540.
    4. David Buck & Martin Raw & Christine Godfrey & Matthew Sutton, 1995. "Tobacco and jobs: the impact of reducing consumption on employment in the UK," Working Papers 023cheop, Centre for Health Economics, University of York.
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    More about this item

    JEL classification:

    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis

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