Estimating the impact of different cigarette package warning label policies: The auction method

The study estimated the reduction in demand associated with implementing cigarette package warning labels that contain imagery illustrating the consequences of smoking. The experimental auction method was used, wherein adult smokers in Mexico (n = 89) placed separate bids on two packs of cigarettes: one with a text-only warning label and the other with a warning label that included text and a graphic image. Differences in the values attributed to each pack were assessed using t-tests and multivariate regression. The pack with the graphic image had a mean attributed value which was 17% lower ($3.21 pesos) than the pack with the text-only warning, and this difference remained statistically significant within subgroups defined by sociodemographics, amount of smoking, number of quit attempts, and levels of perceived smoking risks. In the multivariate model, the difference in attributed values was greater among females than males, but no such differences were found for other sociodemographic or smoking-related variables. The consistently lower value that smokers attributed to cigarette packages with the graphic warning label indicates that these labels are likely to reduce cigarette demand.