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Open AccessArticle

Advertising Restrictions and Market Concentration in the Cigarette Industry: A Cross-Country Analysis

Institute for Health Research Policy, University of Illinois at Chicago, Chicago, IL 60608, USA
Int. J. Environ. Res. Public Health 2019, 16(18), 3364; https://doi.org/10.3390/ijerph16183364
Received: 7 August 2019 / Revised: 4 September 2019 / Accepted: 5 September 2019 / Published: 12 September 2019
(This article belongs to the Special Issue Tobacco Control: Policy Perspectives)
There has been a large increase in the adoption of tobacco advertising restrictions worldwide over the last two decades. Much of the literature studies their direct effect on cigarette demand. This paper investigates the indirect effect of advertising restrictions by evaluating the effect of the policies on the degree of concentration in the tobacco market. By using the variation between countries in timing of adoption of advertising restrictions, I estimate difference-in-difference models to examine the effect of an advertising ban on market-concentration, as measured by HHI. I find that advertising bans lead to an increase in market-concentration: HHI increased by 0.06 points for countries that adopted a ban between 2001 and 2017 conditional on trade and socio-economic characteristics, representing a 13% increase with respect to the mean (0.44). The effect is higher in developing countries (0.08 points increase). Further, I find that ‘comprehensive’ restrictions have a stronger impact on concentration, and ‘limited’ restrictions have little or no impact. These findings point to an important trade-off for policymakers: on one hand, advertising restrictions are likely to reduce consumption of cigarettes; on the other hand, due to an increase in market-concentration, they may be giving more power to tobacco companies. View Full-Text
Keywords: tobacco; health economics; industrial organization tobacco; health economics; industrial organization
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MDPI and ACS Style

Mirza, M. Advertising Restrictions and Market Concentration in the Cigarette Industry: A Cross-Country Analysis. Int. J. Environ. Res. Public Health 2019, 16, 3364. https://doi.org/10.3390/ijerph16183364

AMA Style

Mirza M. Advertising Restrictions and Market Concentration in the Cigarette Industry: A Cross-Country Analysis. International Journal of Environmental Research and Public Health. 2019; 16(18):3364. https://doi.org/10.3390/ijerph16183364

Chicago/Turabian Style

Mirza, Maryam. 2019. "Advertising Restrictions and Market Concentration in the Cigarette Industry: A Cross-Country Analysis" Int. J. Environ. Res. Public Health 16, no. 18: 3364. https://doi.org/10.3390/ijerph16183364

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