Economic man and the consumption of addictive goods: the case of two goods
2006 (English)In: Substance Use & Misuse, ISSN 1082-6084, E-ISSN 1532-2491, Vol. 41, 453-466 p.Article in journal (Refereed) Published
It is well known that cigarette smoking and the use of other addictive goods is harmful to health. Still, some people smoke cigarettes and drink alcohol in their daily lives. The consumption of addictive goods seems, therefore, to be the antithesis of rational behavior. In this article, however, it is demonstrated that a rational individual, in the sense that he or she maximizes his or her well-being while anticipating the future consequences of his or her choices, may in fact choose to consume addictive goods. Specifically, the two-good extension of the rational addiction model is demonstrated and related to relevant policy questions. For instance, should one encourage the use of smokeless tobacco in smoking cessation programs? According to the empirical results, the answer is no. Further, should one discourage smoking by increasing the tax on cigarettes? Again, the answer is no.
Place, publisher, year, edition, pages
New York: Dekker , 2006. Vol. 41, 453-466 p.
alcohol, bootlegging, cigarette smoking, complements, craving, demand, elasticity, habit stock, myopic behavior, rational addiction, relapse, satisfaction, substitutes, tolerance, utility
Research subject Economics
IdentifiersURN: urn:nbn:se:umu:diva-26751DOI: 10.1080/10826080500522019OAI: oai:DiVA.org:umu-26751DiVA: diva2:273746