A Study on the Economics of Tobacco in Nepal

Karki, Yagya B. ; Pant, Kiran Dev ; Pande, Badri Raj

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Abstract

This study is based both on secondary and primary data. The primary data were collected using a smoking behavior survey and a purposive sample survey among tobacco-cultivating farmers. The overall smoking prevalence in Nepal for the population aged 15 or more is estimated at 37.4%, and is higher (47.4%) among males than among females (27.6%). Poor people are more likely to consume tobacco than their better-off counterparts, resulting in increased health hazards and the diversion of scarce income. The tobacco industry is a lucrative business for the private sector and government; the private sector makes large profits, and the tax revenue is substantial. Economic analysis estimated the price elasticity of demand for cigarettes and bidi at -0.882. It is found also that the poor and the young are the groups most sensitive to price changes. Therefore, considering health and economic benefits and poverty alleviation goals, a policy of real price increase through taxation of all types of tobacco product would be a desirable public policy for the government of Nepal to consider.

Document type: Working paper
Publisher: The World Bank
Place of Publication: Washington, D.C.
Date: 2003
Version: Secondary publication
Date Deposited: 13 December 2015
Number of Pages: 84
Faculties / Institutes: Miscellaneous > Individual person
DDC-classification: Medical sciences Medicine
Controlled Subjects: Nepal, Tabakkonsum, Raucher
Uncontrolled Keywords: Nepal, Tabakkonsum, Raucher / Nepal, Tobbaco Consumption, Smoker
Subject (classification): Medicine
Economics
Countries/Regions: Nepal
Additional Information: © World Bank. https://openknowledge.worldbank.org/handle/10986/13750 License: CC BY 3.0 IGO
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