Objective To determine if the Ohio statewide smoke-free law is associated with economic activity in Ohio or Kentucky counties that lie on the border between the two states. In November 2006, Ohio implemented a comprehensive statewide smoke-free law for all indoor workplaces.

Design A feasible generalised least squares (FLGS) time series design to estimate the impact of the Ohio smoke-free law on Kentucky and Ohio border counties.

Setting Six Kentucky and six Ohio counties that lie on the border between the two states.

Subjects All reporting hospitality and accommodation establishments in all Kentucky and Ohio counties including but not limited to food and drinking establishments, hotels and casinos.

Main outcome measures Total number of employees, total wages paid and number of reported establishments in all hospitality and accommodation services, 6 years before Ohio's law and 1 year after.

Results There is no evidence of a disproportionate change in economic activity in Ohio or Kentucky border counties relative to their non-border counterparts. There was no evidence of a relation between Ohio's smoke-free law and economic activity in Kentucky border counties. The law generated a positive influence on wages and number of establishments in Ohio border counties. The null result cannot be explained by low test power, as minimum changes necessary in the dependent variables to detect a significant influence are very reasonable in size.

Conclusions Our data add to the large body of evidence that smoke-free laws are neutral with respect to the hospitality business across jurisdictions with and without laws.