The only problem is that it's not new data. It's exactly the same ABS data that people have been discussing for the last few days, including in this blog post. As previously mentioned, the figures only support the idea that plain packaging reduces tobacco consumption if you ignore the whole of 2013 and focus only on the first quarter of 2014 when there was a big increase in tobacco tax. Attributing a decline in consumption that took place in early 2014 to a policy that was introduced in December 2012 is mischievous to say the least.
Nevertheless, the Kouk has taken the nuclear option of calling those who have noticed that the emperor is wearing no clothes 'deniers'. He continues to talk about "a 5.3 per cent fall in the overall volume of tobacco consumed between the December quarter 2012 and the March quarter 2014". His maths are wrong, it's actually a 2.9 per cent fall, but the important point is that this decline did not take place in the year after plain packaging came in. It took place after a 12.5% tax hike was implemented twelve months later. In the June and September 2013 quarters, sales were higher than they had been in December 2012. These were the first increases in tobacco sales for several years.
It doesn't look great for plain packaging, does it? Especially after all that guff about smokers seriously, er, thinking about giving up smoking and calling the quitline in their, er, hundreds.
Simply put, the plain packaging desperados want you to ignore what happened after plain packaging was introduced and instead focus on what happened after the December 2013 tax hike. You can see why they want you to do that. The graph below shows what happened in the first year of the plain packaging regime. Bugger all.
But this is the graph that the straw-clutchers want you to focus on, or rather they want you to focus on the far right hand side and mentally substitute the words 'tax hike' for 'plain packaging'. Yes, tobacco sales were lower in the first quarter of 2014, but there is a pretty obvious explanation for that.
The price elasticity of cigarettes is often said to be -0.4 so we would expect a 4 per cent decline in consumption from a 12.5 per cent tax hike regardless of any other policy intervention (roughly speaking, based on tax making up 80% of the price—and this refers to legal sales; what it does to illicit sales is another matter.) In fact, it fell by less than that (2.5 per cent) so even that policy failed to live up to expectations.
Kouk then offers a wager...
I will wager that when we get the ABS measure for the household consumption of tobacco and cigarettes for the December quarter 2014, it will show lower consumption than for ANY quarter in 2012 or 2013.
Of course, no one will take that bet because of the secular decline in tobacco sales and the tax rise. It's possible that sales might increase, but if he's only offering even money, I'd decline. But although I wouldn't take Kouk's bet, I would have happily taken a bet in 2012 on whether there would be an unusually large dip in consumption after plain packaging. I would have bet 'no' and I would have won.
UPDATE
ABS also has seasonally adjusted tobacco sales figures, shown below. Same story.
7 comments:
To bad there isn't an overlay graph of Blackmarket sales to put up against that tax increase upsurge in lost sales..........for that period Im sure nobody quit they just used other avenues to get the product!
Via DP
Claims plain packaging works go up in smoke
|
The Australian |
June 16, 2014 12:00AM
Print
Save for later
50
Judith Sloan
Contributing Economics Editor
Sydney
http://www.theaustralian.com.au/opinion/columnists/claims-plain-packaging-works-go-up-in-smoke/story-fnbkvnk7-1226955234066
Your right they are whining and crying...........
Australian Medical Association accuses The Australian of promoting smoking
Newspaper says plain packaging led to an increase in tobacco sales, but this claim has been attacked by a number of people
The Australian Medical Association has accused Rupert Murdoch’s The Australian newspaper of promoting smoking and “big tobacco” by publishing a series of articles undermining the nation’s plain packaging legislation.
The Australian, owned by News Corp, has previously argued that plain packaging deprives tobacco firms of their intellectual property rights, and earlier this month went further and claimed that plain packaging had led to an increase in tobacco sales.
“The AMA urges the government to restate its support for the plain packaging laws and tobacco control generally, and we urge the Australian and other media to stop giving Big Tobacco a free ride in promoting its killer products,” the AMA president, Associate Professor Brian Owler, said.
The intervention of the peak medical body came after The Australian published another five articles on Wednesday critical of public health initiatives to decrease smoking rates, including plain packaging.
The series of news reports and opinion pieces were in response to the ABC’s Media Watch program, which slammed The Australian’s earlier exclusive story claiming that there had been an increase in consumption as “garbage”.
On 6 June The Australian ran a front-page story headlined “Labor's plain packaging fails as cigarette sales rise”.
“Labor’s nanny state push to kill off the country’s addiction to cigarettes with plain packaging has backfired, with new sales figures showing tobacco consumption growing during the first full year of the new laws,” the newspaper reported.
http://www.theguardian.com/world/2014/jun/18/australian-medical-association-accuses-the-australian-of-promoting-smoking
That decline in sales after the tax rise is probably accounted for by the no doubt many consumers who have turned to the black market.
When people agree with antismoking measures, it’s because antismokers are right.
When people disagree with antismoking measures, it’s because antismokers are right.
Antismokers are always right.
Can’t get more scientific than that.
:)
Anonymous comment on 18 June is absolutely spot on. I have been purchasing Duty Free, black-market cigarettes for the past year from the same source. He seems to have no problems ensuring supply and more and more of his trusted customers are purchasing the better quality, cheaper, and branded duty free products. The black market is booming. But naturally these figures cannot be assessed or incorporated into so-called research studies. It is also worth noting that the plain package cigarettes currently on sale in Australia are all being made and packaged from the same source in South Korea - irrespective of the brand. You can taste how cheap and horrible these products are. Its another reason why the black-market is proliferating - access to better quality products. When will the zealots learn that restrictions and prohibitions simply don't work?
Anonymous comment on 18 June is absolutely spot on. I have been purchasing Duty Free, black-market cigarettes for the past year from the same source. He seems to have no problems ensuring supply and more and more of his trusted customers are purchasing the better quality, cheaper, and branded duty free products. The black market is booming. But naturally these figures cannot be assessed or incorporated into so-called research studies. It is also worth noting that the plain package cigarettes currently on sale in Australia are all being made and packaged from the same source in South Korea - irrespective of the brand. You can taste how cheap and horrible these products are. Its another reason why the black-market is proliferating - access to better quality products. When will the zealots learn that restrictions and prohibitions simply don't work?
Post a Comment