Cigarette affordability trends: an update and some methodological comments

Abstract

Objectives: To calculate cigarette affordability for a number of countries using different techniques and data, to investigate trends since 1990 and to assess the appropriateness of different measures of affordability.

Design: Two existing measures were specified. Relative income price (RIP) uses per capita gross domestic product (GDP) as the measure of income, while "minutes of labour" is based on a Union Bank of Switzerland (UBS) survey of earnings.

Subjects: RIP (1990-2006) is calculated for 32 high-income and 45 low-income and middle-income countries. The "minutes of labour" measure is calculated for 29 high-income and 23 low-income and middle-income countries.

Results: In high-income countries cigarettes are significantly more affordable than in low-income and middle-income countries, but have become less affordable since 1990. Among low-income and middle-income countries, cigarettes have become more affordable since 1990 and at an increasingly rapid rate since 2000. In 33 of 34 countries where cigarette affordability decreased since 1990, the real price increased. In 20 of 37 countries where cigarettes became more affordable, real price decreased. When measuring affordability in low-income and middle-income countries, a broad income measure, such as per capita GDP, is most appropriate. For high-income countries, the choice of income measure is not important.

Conclusions: In international comparisons, cigarette prices should not only be viewed in monetary terms but also in terms of their affordability. Fast-growing countries face greater tobacco control challenges since rising incomes increase the affordability of cigarettes. The fact that cigarettes have become increasingly affordable in a majority of low-income and middle-income countries is a major tobacco control failure.