ABSTRACT
This chapter provides theoretical background on the role of advertising. It summarizes the extant literature on cigarette advertising, paying special attention to the available international evidence. The chapter evaluates the effects of different policies related to checking cigarette advertising. A high advertising elasticity would invite advertising bans or restrictions as policymakers look for non-tax means of controlling smoking. Bans on cigarette advertising are quite prevalent across the globe as regulators try to reduce the possibility of new consumers, especially youth, being tempted to start smoking. The advertising elasticity measures the responsiveness of the quantity demanded to changes in advertising and is generally a positive number. The success of teenage anti-smoking policies to date has been called in question by the international trend in the decline in smoking initiation age. In particular, a WHO (1996) report estimates that in many countries in the early 1990s the median smoking initiation age was under 15 years.
