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Countervailing Effects: What the FDA Would Have to Know to Evaluate Tobacco Regulations

February 25, 2015Discarded Pack Papersillicittobaccoinfo_t6j48a

by: Mark A.R. Kleiman, James E. Prieger, and Jonathan Kulick

Illicit trade in tobacco is a large and growing problem in the U.S., causing loss of tax revenue and damage to public health and safety. Decisions about enforcement against ITTP involve tradeoffs among competing objectives. Good policy design can improve the terms of those tradeoffs but not eliminate them. We examine questions both about the overall level of ITTP and its distribution across activities, individuals, and organizations, in particular whether and how to differentially target ITTP that involves violence or support for terrorism. Lessons from experience with markets for illicit drugs and insight from the theory regarding targeted enforcement are applied to developing effective strategies for enforcement. We show that targeted enforcement and focused deterrence are more efficient than unfocused enforcement. We discuss additional considerations, ranging from real-world complications left out of the simple models to examination of how insights from behavioral law and economics may reinforce or obviate a crime intervention based on a theory of deterrence designed for homo economicus.

The full report can be found here: Countervailing Effects – What the FDA Would Have to Know to Evaluate Tobacco Regulations

Next post Unintended Consequences of Cigarette Prohibition, Regulation and Taxation

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