Smoke‐free Ordinances Increase Restaurant Profit and Value | Zendy

Alamar Benjamin C. | Zendy; Glantz Stanton A. | Zendy

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Smoke‐free Ordinances Increase Restaurant Profit and Value

Author(s) -

Alamar Benjamin C.,

Glantz Stanton A.

Publication year - 2004

Publication title -

contemporary economic policy

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 0.454

H-Index - 49

eISSN - 1465-7287

pISSN - 1074-3529

DOI - 10.1093/cep/byh038

Subject(s) - profitability index , smoke , jurisdiction , profit (economics) , economics , business , law , agricultural economics , microeconomics , finance , physics , meteorology , political science

This study estimates the value added to a restaurant by a smoke‐free policy using regression analysis of the purchase price of restaurants as a function of the presence of a smoke‐free law and other control variables. There was a median increase of 16% (interquartile range 11% to 25%) in the sale price of a restaurant in a jurisdiction with a smoke‐free law compared to a comparable restaurant in a community without such a law. This result indicates that contrary to claims made by opponents of smoke‐free laws, these laws are associated with an increase in restaurant profitability. (JEL I120 , H000 , D780 )

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