Determinant of Cigarettes Consumption on Poor Households in Regency of Situbondo, Indonesia

Abstract

The first step model was using Probit analysis that was aimed to determine the probability of the households to smoke. Meanwhile the two-step model using Ordinary Least Square (OLS) method was applied especially for cigarette consumption households. The results of this study indicated income and price of complementary goods (such as sugar and coffee) were significantly influence to cigarette consumption. On the other hand price was not a significantly effect on the decision to smoke, but it had significantly effect to the quantity of cigarettes smoked. Higher cigarette expenditures will reduce spending on health and education.