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The effect of the 1971 advertising ban on behavior in the cigarette industry
Author(s) -
Gallet Craig A.
Publication year - 1999
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/(sici)1099-1468(199909)20:6<299::aid-mde942>3.0.co;2-8
Subject(s) - advertising , competition (biology) , business , television advertising , marketing , economics , ecology , biology
The 1971 ban on TV and radio advertising of cigarettes offers a unique opportunity to uncover the industry response to a change in the mix of advertising. Following the ban, advertising expenditures were shifted away from TV and radio towards print media. Accounting for the impact of this event within a supply and demand framework, the empirical results show that advertising had an insignificant effect on demand during the pre‐ and post‐1971 periods; however, advertising did stimulate competition in the industry prior to the 1971 ban. Copyright © 1999 John Wiley & Sons, Ltd.