Do smoking bans affect local economies?


One of the most effective arguments people make against all-out smoking bans is that they damage local economies. In tough and uncertain economic times, this kind of statement strikes at the heart of citizens who have had their fill of financial turmoil, even if they find merit in total smoking bans. So does a smoking band really have a negative impact on local economies? Let’s take a closer look.

Smoking ban advocates place public health and the greater good at the forefront of their arguments for such anti-smoking measures. They believe that the toxins in tobacco smoke must be eliminated from the public sphere in order to keep people safe from smoking-related illnesses. Hence, they promote the widespread banning of cigarettes.

Those who are opposed to smoking bans argue that restaurants, bars and small shops that thrive on patrons who either purchase or smoke cigarettes will be put in jeopardy if tobacco products are made illegal. Local economies thrive on the aforementioned businesses and the logic is that when they take a hit, the entire local economy takes a hit.

So what really happens?

The truth is that smoking bans have very little impact on local economies. According to economist Michael R. Pakko of The Regional Economist, this is mainly because a rudimentary rule of consumer theory can be applied to this situation: when a product is denied the market, consumers find viable replacements or ways of spending the same amount of money on different products. When cigarettes are no longer available, consumers choose to spend their money on different things, sometimes chewing tobacco, sometimes more beer at dinner. Consumers rarely stop spending the money that they allotted for cigarettes all together—in fact, just like people who quit smoking, they may be surprised to find how much extra spending money they have when they are unable to buy cigarettes.

Those opposed to smoking bans do have a more legitimate claim in the dangers of banning tobacco products in terms of the development of a black market. They claim that banning cigarettes will make them more enticing and create a black economy centered on them, much in the same way as drugs like heroin and cocaine. It is true; banning something or making it taboo often makes it more appealing. But the fact of the matter is that the size or influence of a black tobacco market cannot be predicted.

In summary, smoking bans do not hinder local economies; cigarettes or no, local economies stay pretty much the same—they are tied to the much larger economic scheme of things, not one product.

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Do smoking bans affect local economies? was last modified: July 2nd, 2015 by Maureen


  1. Thanks for the feedback and I will be looking into this. Cheers

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