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A double-hurdle approach to modelling tobacco consumption in Italy


Aristei, David; Pieroni, Luca


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Abstract This paper analyses the determinants of tobacco expenditures for a sample of Italian households. A Box-Cox double-hurdle model adjusted for heteroscedasticity is estimated to account separate individual decisions concerning smoking participation and tobacco consumption and to correct for non-normality in the bivariate distribution of the error terms. Nested univariate and bivariate models are found to be excessively restrictive, supporting the adequacy of a generalized specification. Estimation results show that consumption decisions are significantly affected by income and demographic characteristics. In particular, income positively impacts tobacco expenditure, while participation probability substantially declines as age increases. The existence of significant gender differences in both smoking participation and tobacco consumption patterns is found, while high education and white collar occupation reduce the likelihood to smoke and tobacco expenditure levels. Single adult households have a lower probability of smoking initiation even if, conditional on smoking, they consume more. Finally, complementarity between tobacco and alcohol beverages suggests the necessity of joint public health strategies.
Klassifikation Wirtschaftssoziologie; Wirtschaftsstatistik, Ökonometrie, Wirtschaftsinformatik
Freie Schlagwörter double-hurdle models; tobacco consumption; limited dependent variables; Box-Cox transformation; C24; D12
Sprache Dokument Englisch
Publikationsjahr 2008
Seitenangabe S. 2463-2476
Zeitschriftentitel Applied Economics, 40 (2008) 19
DOI http://dx.doi.org/10.1080/00036840600970229
Status Postprint; begutachtet (peer reviewed)
Lizenz PEER Licence Agreement (applicable only to documents from PEER project)