Input variable | Description |
y | Individual income. |
s (y) | Smoking prevalence, varies with income. |
c (y) | Consumption of cigarettes per year, varies with income. |
: before increased taxation. : after increased taxation. | |
Price elasticity of demand for cigarettes, varies with income. | |
p | Retail price of cigarettes : before increased taxation. : after increased taxation. |
t | Share of taxes within retail price of cigarettes : before increased taxation. : after increased taxation. |
Change in retail price due to increased taxation. | |
r | Relative change in retail price |