Peer networks and tobacco consumption in South Africa

Type Working Paper - ERSA Working Paper 586
Title Peer networks and tobacco consumption in South Africa
Issue 586
Publication (Day/Month/Year) 2016
This paper deepens the empirical analysis of peer networks by considering simultaneously their effects smoking participation and smoking intensity. Peer network is key in determining the smoking behaviour of youths, but the magnitude of the effects is still debated, questioned and inconclusive. I used a control function approach, a two-step least square and the fixed effect method to address the potential endogeneity of peer network. The results suggest positive and significant peer effects on smoking participation and intensity. While the magnitude of the estimates of smoking participation varies across methodological approaches (ranging between 4 and 20 percent), that of smoking intensity ranges between 3 and 22 percent. Including older adults in the peer reference group increases the peer effects. The findings suggest that policies (excise tax) that directly affect the decision to smoke and the smoking intensity of the peer reference group are likely to affect own smoking behaviour

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