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Forgone earnings from smoking : evidence for a developing country, Volume 1
Author:Lokshin, Michael; Beegle, Kathleen; Country:Albania;
Date Stored:2006/09/29Document Date:2006/10/01
Document Type:Policy Research Working PaperSubTopics:Health Monitoring & Evaluation; Disease Control & Prevention; Alcohol and Substance Abuse; Adolescent Health; Tobacco Use and Control
Language:EnglishRegion:Europe and Central Asia
Report Number:WPS4018Collection Title:Policy, Research working paper ; no. WPS 4018
Volume No:1  

Summary: The authors estimate the economic losses related to the negative effect of smoking on wages in a context of a developing country. Using data from the 2005 Albania Living Standards Monitoring Survey, they jointly estimate a system of three equations: the smoking decision and two separate wage equations for smokers and nonsmokers. The results show that, after controlling for observed characteristics and taking into account unobserved heterogeneity in personal characteristics, smoking has a substantial negative impact on wages. On average smokers' wages are 20 percent lower than the wages of similar nonsmokers, providing strong evidence for the potential policy relevance of tobacco control initiatives for developing countries.

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