Urban Studies and Planning Commons^™

Unintended Consequences Of Cigarette Prohibition, Regulation, And Taxation, Jonathan D. Kulick, James E. Prieger, Mark A. R. Kleiman

All Faculty Open Access Publications

Laws that prohibit, regulate, or tax cigarettes can generate illicit markets for tobacco products. Illicit markets both reduce the efficacy of policies intended to improve public health and create harms of their own. Enforcement can reduce evasion but creates additional harms, including incarceration and violence. There is strong evidence that more enforcement in illicit drug markets can spur violence. The presence of licit substitutes, such as electronic cigarettes, has the potential to greatly reduce the size of illicit markets.

We present a model demonstrating why enforcement can increase revenues in the illicit market, show that states with higher tobacco taxes …