tobacco price elasticity

Tobacco price elasticity refers to how sensitive people's tobacco consumption is to changes in its price. If demand is elastic, a small increase in price will lead to a significant decrease in how much people buy, often because they find alternatives or reduce usage. If demand is inelastic, even substantial price hikes won't change purchasing habits much, as users may be addicted or lack alternatives. This concept helps policymakers understand how taxes and price increases can effectively reduce tobacco use, especially among youth and low-income groups where demand tends to be more elastic.