2

STATEMENT OF THE PROBLEM

This study determined the effect of cigarette prices on youth smokers.

1. What is the demographic profile of the students who are smoking in terms

of ;

a. Age

b. Gender

c. Course consumption

2. What are the prices of the cigarettes in the local areas?

3. What is the effect of the prices of cigarettes at their economic status?

 3

SIGNIFICANCE OF THE STUDY

The significance of this study is to evaluate prices of cigarettes and

the effect of it;

1. Smokers - It gives information and awareness to the smokers about

cigarette prices regarding to how it is being costlier.

2. Students – To know more about the restricted areas where they can

smoke. It also brings awareness to the students about the excise of

cigarettes. This study attempt information that most of the youth

smokers are getting the money in spending to cigarettes are from their

parents.

3. Parents – It gives information and awareness to the parents why does

authorities collected fine. This study will help the parents to know

more about levy.

4. School – This study will help the school to implement restricted areas

and to impart the provided laws by the government officials in regards

with the existing study.

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CHAPTER II

REVIEW OF LITERATURE

One of the most micro level studies on the economics youth smokers

appeared in the 1980’s. Lewit, Coate, and Grossman (1981) studied the

smoking behaviour of young respondents (12 to 17 years old) in years

1966-1970. Their demand equation tested retail prices of cigarettes while

controlling for various socioeconomic factors such as age, sex, race,

family size, income, labor force status of mother, and for smuggling. The

two-part model estimated an overall price elasticity of -1.44, a figure

higher than the same estimates from the previous macro data studies. The

authors hypothesized that young consumers might be more price

responsive than adults because of lower disposable income. They also

found that price has more effect on the decision to smoke at all than on the

number of cigarettes smoked by a smoker. Anti-smoking advertising had a

negative effect on smoking participation but it did not change the number

of cigarettes consumed by smokers.

In 1982, Lewit and Coate used data with respondents 20 to 74 years

old. They concluded that smuggling can bias results and that the

smuggling incentives should be controlled for. Dividing the sample into

three age group (20-25, 26-35, 36-74) and estimating separately the

respective price responsiveness confirmed the hypothesis about the higher

price elasticity among youth, perhaps also due to shorter smoking history
 5

(the addiction to nicotine did not have a chance to fully develop), higher

discount rate for future consumption, and the multiplying effect of peer

pressure which is stronger for young adults than for older consumers.

As in the 1981 study, price had a larger effect on a person’s decision

to smoke than on the number of cigarettes consumed by a smoker.

Wasserman, et al. (1991) [10] also analyzed respondents from 20 to 74

years old. Their demand equation controlled for the state level anti-

smoking regulations and found significant effect of prices on the amount

smoked by the young smokers. The authors attributed this result to a

positive correlation between cigarette prices and state smoking policies

and argued that the results of previous studies are biased upward since

they ignored this correlation (an omitted variable bias).

They also estimated price elasticities by years and found that they

differ. For example the results for 1970, 1974, and 1985 were 0.06, -0.017,

and -0.23 respectively, which led them to hypothesized that the elasticities

were increasing over time, perhaps because of growing awareness of

cigarette harm. However, the results of Wasserman, et.al (1991) were

supported by a relatively small sample with only 1,891 respondents.

Chaloupka in his 1988, 1990 and 1991 publications studied the addictive

nature of smoking. He applied his rational addiction model in longitudinal

data from the Second National Health and Nutrition Examination Survey

(1976-1980). While controlling for age, race, gender, education, income,

 6

physical activity and cigarette prices he found adjacent complementarities

in cigarette consumption, supporting the hypothesis of rational addiction.

Chaloupca agreed with Wasserman, al. (1991) regarding price

sensitivity of young adults because he also found them less responsive

compared with older age groups. This result cast serious doubt on the

hypothesis of higher price sensitivity of younger respondents as it was

supported by a larger respondent’s sample.

Because of Wasserman, et al. (1991) and Chaloupca (1991) results,

the issue of price responsiveness of young individuals was subjected to

further investigation. In 1994, Douglas and Hariharan addressed the issue

of smoke initiation, which is primary related to youth smoker’s

participation.

They analyse retrospective data from the 1978 and 1979 Smoking

supplements to the Health Interview Survey by applying a hazard model

called the split population duration model. They did not control for

smuggling opportunities (which might bias the price effect toward zero),

and did not include public policies in their models. The results of this

analysis confirmed the effect of various socio-demographic variables on

smoking initiation but the authors did not find prices to be a significant

determinant of youth smokers. Chaloupca and Grossman (1996) used the

Monitoring the future data on 110, 717 high school students from 1992 to

1994 to study price elasticities, the effect of smoking restriction in both

public and private places, and the effects of rules limiting youth access to
 7

tobacco products. They estimated two part models with excise taxes as a

price measure.

The range of the estimated cigarette price elasticities for various

models (-0.846) - (-1.450) supported the hypothesis about higher

responsiveness of youth to cigarette price charges.

In 1997 Chaloupca and Wechsler (1997) estimated price and policy

effects on the smoking behaviour of 16, 500college students. The study

supported the hypothesis that young adults exhibit relatively high price

sensitivity to cigarette prices: the overall price elasticity ranged from

-0.906 to -1.309.

Only relatively stringent limits on smoking in public places had

negative and significant effects on smoking participation, and some

restrictions could reduce the quantity of cigarettes smoked by smokers.

Evans and Farrelly (1998) estimated overall price elasticities for

two different age groups (18-24 and 25-39) and found the younger one to

be more responsive to a change in cigarette prices (price elasticities were

-0.63 and -0.42 for the two groups, respectively). Having information on

cigarette brand choices in their data set, they investigated if a tax change

can change smokers preferred brands.

They found that an increase of taxes could induce compensating

behaviour towards longer cigarettes or towards cigarettes with higher

nicotine and tar content. The younger age group (18-24) had particularly

strong substitution reaction so that a tax increase can actually result in

 8

higher tar/nicotine intake for those smokers who continue to smoke despite

the tax increase.

Chaloupca and Pacula (March 1998) examined the effects of limits

on youth access on smoking rates among 1994 respondents (8th, 10th, and

12th grade) of the monitoring the Future Project. Because previous mixed

results on the effects of tobacco control policies were attributed to lack of

enforcement, they added to the data variables regarding state monitoring

activities, enforcement of regulations limiting youth access to tobacco, and

compliance with them. Controlling for smuggling, the authors estimated

the total price elasticity of cigarette demand at -1.141, with the price

elasticity of participation -0.618 and the conditional price elasticity -0.523.

Most state and local non-tax tobacco control policies did not have

statistically significant effects on youth smoking with the exception of

relatively strong restrictions. However, when the policy variables were

tested for joint significance, their combined effect on smoking

participation was significant.

The single most consistent conclusion from the economic

literature on the demand for cigarettes is that consumers react to price

changes according to general economic principles – an increase in price

leads to a decrease in consumption. Prices not only control the quantity of

cigarettes consumed, but they also affect smoking prevalence among the

young population. While the estimates of those responses vary from study
 9

to study, the current consensus for the overall price elasticity of youth

cigarette demand centre in the range from 0.9 to 1.5.

 10

DEFINITION OF TERMS

Adjacent tracks – mean two or more tracks with center spaced less than 25

feet apart.

Costlier – a great price or value, expensive.

Excise – the indirect or internal tax on the production, consumption or sale

of commodity, such as tobacco and liquor that is produced, sold and

used or transported within a country.

Hysterectomy – surgery on a female which partially or completely removes

the uterus.

Huge – mean exceeding large.

Intervention – action taken to intentionally become involved in difficult

situation in order to improve it or prevent it from getting worse.

Levy – to impose and collect by authority or force as fine or tax. To draft

for military service to prepare for begin or wage war.

Osteoporosis – a disorder causing gradual deterioration of bone tissue,

usually occurring in older women.

Perimeter – two dimensional shapes, a measurement of the distance around

something the length of the boundary.

Restrict – to confine within limits.

Risk – a chance of suffering or encountering harm or loss; danger.

Track of land – is a very large area of land, a vast track of land is ready for

development.
 11

CONCEPTUAL FRAMEWORK

Dependent Variable Independent Variable

Smokers

Effect Of Cigarette Age

Prices
Gender

Occupation of Parents

CHAPTER III

METHODOLOGY

This research will utilize the descriptive method approach,

because researchers will conduct survey as their instrument to

address the existing studies. It is also a descriptive type of research.

Researchers will collect data’s from the conducted survey by

 12

merely using their suggested tools. As the results came out,

researchers will tabulate it to know the effectiveness of the study,

then on, the researchers will explain more which is which and the

effect of the existing studies in their daily life.

This is a non-numerical approach pertaining qualitative

paradigm. The researchers will use the survey questionnaire as

their tools to evaluate and gather data needed in the study in which

also the gaps of the existing studies will have clarification and

bridge out.

In addition, conducting survey help more the researchers to

address the gaps of the existing studies.

Research setting

The locale of the respondent is located at Barangay Vitali,

Zamboanga CitydistrictII also known as one of the most abundant in

marine products.

Zamboanga City State Polytechnic College (ZCSPC) Vitali Extension

Programcan be found nearby Vitali Police Station, Vitali Barangay Hall and
 13

Vitali Lying-In. It contains several numbers of students with specific

courses.

The predominant occupation of the people of Vitali are fisherman

and farmers, in regards with their social status most of them earned twelve

(12) thousand a month, and yet they are continues working because of their

daily needs.

According to their economic status, Barangay Vitali continues

improving, yet they are affected by inflation.

Vitali contains several languages and culture, it pertains 75% of

Chavacano, 20% Bisaya and 5% of Islam, but then again they are united and

sociable. They are both respectful in accordance with their culture and

beliefs.

Research Procedures

I- Prepare the materials and other requirements for survey

-Preparing the tools and instrument for conducting survey.

II- Recheck all the materials and requirements prepared.

-To ensure that the tools and instrument prepared are more liable

to the existing study.

 14

III- Study the locale of the respondent

-To assure that the locale are peaceful and not in danger for

safety.

IV- Prepare the respondent

-To assure that the gaps of the existing studies will address.

V- Conduct survey

-Gathering of datas and information. Actual studies to collect

datainformation.

VI- Collect data information

-Tallying the results of the conducted survey.

VII- Evaluation

-Finalizing the results of the conduct activity; evaluation of datas

gathered.

CHAPTER IV

PRESENTATION, INTERPRETATION

This chapter present the information gathered, tabulated, interpreted and analyzed.

The data gathered from the survey questionaire that distributed and answer by the

respondents bring about the conclusion to every question in the study.

 15

Respondents Profile

The following information where gathered from the respondents;

Table no: 1

Age of the respondents

Age Frequency Percentage

17-19 10 38.46%
20-22 9 34.62%
23-25 7 26.92%
Total 26 100%

Table 1 shows the age of the respondents included in the study of the

total 26 respondents, 10 or 38.46% are 17-19, 9 or 34.62% are ages from

20-22 and 7 or 26.92% are ages 23-25.Which means that the most of the

youth smokers are ages from 19-17.

Table No: 2

Gender of the respondents

Gender Frequency Percentage

Male 23 88..46%
Female 3 11.54%
Total 26 100%

Table 2 shows the gender of the respondents included in the study of

the total 26 respondents, 23 or 88.46% are male while 3 or 11.54% are

female, which means that the most of the teenage smokers are male.

Table No: 3
 16

Occupation of the respondent’s mother

Course consumption Frequency Percentage

Housewife 24 92.31%
Businesswoman 1 3.85%
Self-employed 1 3.85%
Total 26 100%

Table 3 shows the course occupation of the respondents mother

included in the study of the total 26 respondents, 24 or 92.31% are

housewife, 1 or 3.85% is businesswoman and another 1 or 3.85% is self-

employed, which means that most of the course consumption of the

respondents mother are housewife.

Table No: 4

Occupation of the respondent’s father

Course consumption Frequency Percentage

Farmer 14 53.85%
Driver 4 15.38%
Soldier 3 11.54%
Barangay kagawad 1 3.85%
Fisherman 2 7.69%
Welder 1 3.85%
Total 26 100%

Table 4 shows the occupation of the respondent’s father of the total

26 respondents, 14 or 53.85% are farmers, 4 or 15.38% are drivers, 3 or

11.54% are soldiers 1 or 3.85% are barangay kagawad and 1 or 3.85% are

welder, which means that the most of the respondents father course

consumption are farmers.

 17

Table No: 5

Prices of cigarettes in local areas

Prices of Frequency Percentage

Cigarettes
P25 – P35 10 38.46%
P35 – P50 5 19.23%
P50 above 11 42.31%
Total 26 100%

Table 5shows the prices of cigarettes in local areas that the

respondent smoked included in the study of the total 26 respondents, 10 or
38.46% are costs P25-P35, 5 or 19.23% costs P35-P50 and 11 or 42.31%
costs P50 above, which means that most of the respondents smoked with a
high cost of cigarette.

Table No: 6
The effect of the prices of cigarettes at their economic status
Effects Frequency Percentage
Yes 12 46.15%
No 4 15.38%
Maybe 10 38.46%
Total 26 100%

Table 6 shows the effect of the prices of cigarettes at their economic

status of the respondents included in the study of the total 26 respondents,

12 or 46.15% are yes, 4 or 15.38% are no and 10 or 38.46% are maybe,

 18

which means that most of the teenage smokers affects the prices of

cigarettes
 19

CHAPTER V

SUMMARY OFFINDINGS, CONCLUSION AND

RECOMMENDATION

Summary

This study aimed to “Effect of the Cigarette Prices on Youth

smokers”. There were 26 respondents in the conduct of the study.

This study will attempt to answer the following questions;

1. What is the demographic profile of the respondent who are smoking in

terms

a. Age

b. Gender

c. Course consumption of Mother

d. Occupation of Father

2. What are the prices of cigarettes in local areas

3. What is the effect of the prices of cigarettes at their economic status

 20

FINDINGS

Based on the research study that was undertaken by the researchers,

following findings of the survey have arrived:

1 . In terms of respondent’s demographic profile

1. Age – That out of 26 respondents, 38.46% where ages from 17-20,

34.62% from ages 22-23 and 7 are ages from 25-25.

1.1 Gender – That out of 26 respondents there are 23 males and 3

females.

1.2 Course consumption – That out of 26 respondents, most of the course

consumption of their mother are only housewife who ranges from

92.31% or 24, 1 or 3.85% are businesswoman and 1 or 3.85% are

self-employed.

That out of 26 respondents, the course consumption of their father are

farmers who ranges from 53.85%, 4 or 15.38% are driver, 3 0r

11.54% who where soldiers, 1 or 3.85% are businessman, 2 or 7.69

are fisherman and 1 or 3.85% who are welder.

2. In terms of prices of the cigarettes in local areas – That out 9of 26

respondents38.46% who smoked cigarettes costs P225-P35, 19.23% costs

P35-P50 and 42.32 who costs P50 above.

3. In terms of the effect of the prices of cigarettes at their economic

status – That out 26 respondents there were 46.15% are affected, 15.38%

who were not and 38.46 % are in maybe. Based on the results of the
 21

conducted survey, it reveals that most of the teenage smokers do really

affect the increase of cigarette prices in their economic status. Some of the

respondent shifted to another brand of cigarettes who costs an affordable

price.
 22

CONCLUSION

From the stated findings the following conclusions were drawn:

In conclusion, the researchers found out that due to influenced by friends

engage in early smoking where in the data revealed that majority of them

are students, because of that reason there is a temptation attempt.

The data also revealed that the youth smokers affected in the

increase of cigarette prices.

The researchers concluded that the youth smokers affected the

increase of cigarette prices, eventhough most of the youth get the money to

buy cigarette from their parents.

 23

RECOMMENDATIONS

Based on the findings and conclusion made the following are hereby

recommended:

The Government officials, to strictly implement the law and put a

designated area for smokers which affordable and also provide a perimeter

and interventions.

The researchers, to come up with a total profile since there is a limited

literature foryouth smokers. And for those who are interested to know more

about the Effect of Cigarette Prices on Youth Smokers to conduct a further

study about the youth smokers which focuses not on the same topic also to

find various agencies which respond to them.

To the youth smokers, to follow the laws or government ordinance

for them to avoid penalties.

 24

REFFERENCES

Books

Victor R. Preedy (2019) Mechanism and Treatment,

Neuroscience of Nicotine .Manila, Philippines: National Book Store.

Webpage

Andrews, R.l., & Franke, G.R 1991. The determinants of

cigarette consumption. Journal of Public Policy and Marketing

10(1) :81-100

Baltagi, B.H & Levin, D. 1987. Quasi-experimental price

elasticities of cigarette demand and the bootlegging effect.

American Journal of Agricultural Economics 69(4):750-754

Bardsley, P.& Olekalns, N. 1998. Cigarette and tobacco

consumption: Have anti- smoking policies made a difference?
Working paper, Department of Economics , the University Of
Melbourne.
Barendregt, J.J., Bonneux, L. & van der mass, P.J 1997. The
health care costs of smoking. New England Journal of Medicine
337(15): 1052-1057
Bishop, J.A. 7 Yoo, J.H. 1985. Health Scare, excise taxes and
advertising ban in the cigarette demand and supply. Southern
Economics Journal 2:402-411
 25

Chaloupka, F.J. 1992. Clean indoor air laws, addiction, and

cigarette smoking. Applied Economics 24(2): 193-205

Chaloupka, F.J., & Grossman, M. 1996. Price, tobacco control

policies and youth smoking. National Bureau of Economic

Research, Working paper no. 5740’