This paper develops an endogenous yardstick competition approach to examine the effects of government anti-smoking campaigns. It finds that government anti-smoking campaigns can benefit the government in political bargaining with the tobacco industry by reducing the tobacco lobby's alternative welfare. Anti-smoking campaigns not only push up the equilibrium taxation on tobacco but also force the tobacco lobby to increase its political contributions because the bargaining position of the industry becomes weaker. The paper also finds that when the effectiveness of campaign spending on the expected vote share increases, the incumbent government / politicians will increase their effort in anti-smoking campaigns, and as a result, extract more political contributions.

Additional Metadata
Keywords Government Anti-smoking Campaigns, Bargaining Position Endogenous Yardstick Competition, Political Contributions
JEL Economic Models of Political Processes: Rent-Seeking, Elections, Legislatures, and Voting Behavior (jel D72), Government Policy; Regulation; Public Health (jel I18)
Publisher Department of Economics
Series Carleton Economic Papers
Citation
Yu, Z. (2004). The Effect of Government Anti-smoking Campaigns: An Endogenous Yardstick Competition Approach (No. CEP 04-13). Carleton Economic Papers. Department of Economics.