Cigarette prices and current, binge, and heavy drinking: Differences by demographic group

Raising prices on tobacco products through taxation is a widespread strategy to reduce their use. As nearly 25% of the U.S. population uses alcohol and cigarettes concurrently, it is important to know whether increasing cigarette prices may impact alcohol use—known in economics as a ‘cross-price effect.' This study examines the effects of changes in state cigarette prices on current, binge, and heavy drinking patterns among demographic groups.

Six years of cross sectional data are pooled from the 2001-2006 Behavioral Risk Factor Surveillance System surveys (BRFSS), a household telephone survey conducted annually with random samples of adults aged 18 years and older. The pooled data yield 1,698,196 independent observations. The main binary dependent variables are current, binge, and heavy drinking. The main explanatory variable is average state cigarette price. Covariates include demographic variables, state tobacco and alcohol policies, and economic indicators. Multivariate Linear Probability Models are estimated that incorporate interaction terms and state fixed effects.

Results indicate heterogeneity in response, dependent on demographic group. For instance, among those aged 21-29, a $1 increase in cigarette price is associated with a 4.1 percentage point (p<.001) increase in participation in binge drinking, and a 1.6 percentage point (p<.01) increase in participation in heavy drinking. For those 65 and older, however, increases in cigarette price reduce their binge drinking by 2 percentage points (p<.01). Other analyses test for difference in response by sex, poverty status, and race/ethnicity.

Policy implications for tobacco control and alcohol prevention researchers and advocates will be discussed.