CERGAS Seminar "A new avenue for tobacco control: price cap regulation"

The tobacco industry generates substantial profits from selling products causing significant health and societal costs. These profits enable the industry to use price as a flexible marketing tool, including using market segmentation and pricing strategies to undermine the intended outcomes of increased tobacco taxation. Consequently, there have been calls for a scheme to cap the wholesale price of tobacco products and to offset this with higher taxation, thereby reducing price variation and raising tax revenue - an approach labelled as a ‘polluter pays levy scheme’ by advocacy organisations in the UK, and a forward looking measure by the WHO Framework Convention on Tobacco Control (FCTC) expert group. In this talk Dr Rob Branston will explore the rationale for such an endgame scheme, including reporting on the modelling of the health and economic impact of such a scheme in England.   This modelling is based on the Sheffield Tobacco and Alcohol Policy Model v2.5.1, an individual-level microsimulation, to project tobacco consumption, spending, and health outcomes for adults in England aged 18–89 from 2025 to 2044. Six illustrative scenarios for implementing a wholesale price cap and concomitant tax rises are explored relative to a business-as-usual scenario of an annual 2% real terms tax escalator. The modelling shows that a tobacco price cap and tax increase would raise a substantial amount of additional tax revenue, improve health, and reduce health inequalities, while also reducing the scope to use price as a tobacco marketing tool.

Speaker:

Dr Rob Branston is an Associate Professor in Business Economics at the University of Bath School of Management and is Co-Director of the UK university’s internationally renowned Tobacco Control Research Group (TCRG). He holds a BSc and a MSc degrees in Economics from the University of Warwick (UK), and a PhD in Industrial Economics from the University of Birmingham (UK). His research interests are centred on the governance and regulation of organisations, with a particular focus on the tobacco industry and separately micro firms. He has widely published on the economics of tobacco control, particularly on matters relating to tobacco product and company taxation. Since 2023 he has been one of the senior editors of the international academic journal, Tobacco Control, and he and his work regularly feature in the media.

Link zoom: 

https://unibocconi-it.zoom.us/j/93629324076?pwd=aMkLwJVqKBbItbMPB0gplhGbVRBWeb.1

Meeting ID: 936 2932 4076

Passcode: 539109

Lunch at the end of the meeting: for those willing to participate in person, click here before the 3rd of September.