The Influence of Income, Cigarette Price and Dependency Ratio on Cigarette Consumption in Indonesia

Abstract

This research is motivated by the high level of cigarette consumption in Indonesia, which negatively impacts the economy and public health. The study aims to examine the influence of income, cigarette prices, and dependency ratio on cigarette consumption in Indonesia. This study uses a quantitative approach with panel data covering the period 2019-2023 for 34 provinces in Indonesia.. The Random Effect Model (REM) was employed to analyze the influence of income, cigarette prices, and dependency ratio variables. The data were analyzed using Eviews 12.The findings indicate that income, cigarette prices, and dependency ratio simultaneously have a significant effect on cigarette consumption in Indonesia. The income and dependency ratio variables negatively but insignificantly affect cigarette consumption, whereas cigarette prices positively and significantly influence it. This study concludes that cigarette consumption in Indonesia is influenced by economic and social factors, necessitating comprehensive policy strategies and education to reduce cigarette consumption in the country.