IFS Parental Income and Childrens Smoking Behaviour: Evidence from the British Household Panel...

IFS

Parental Income and Children’s Smoking Behaviour: Evidence from the British

Household Panel Survey

Andrew Leicester

Laura Blow

Frank Windmeijer

© Institute for Fiscal Studies, 2005

Child Smoking – targets

• Government target:

Reduce proportion of children aged 11 – 15 who smoke regularly from 13% (1996) to 11% by 2005 and 9% by 2010

» “Smoking Kills – A White Paper on Tobacco” (1998)


Child Smoking - progress

0

2

4

6

8

10

12

14

16

1982 1986 1990 1994 1998 2002 2006 2010

Per

cen

tag

e sm

oki

ng

Boys

Girls

Overall

2005 target

2010 target

Source: Smoking, Drinking and Drug Use among Young People in England in 2004" (Department of Health)


Current evidence

• Tyas and Pederson (1998)– Literature review of determinants of youth smoking– Consider parental socioeconomic status and

children’s personal income:

• “Higher levels of parental socioeconomic variables, such as education and social class, have often been found to be inversely related to smoking status in adolescents …”

• “… young people with more spending money showed higher levels of smoking …”


Further studies

• Soteriades and DiFranza (2003)– Study of Massachusetts teenagers– Controlling for children’s demographics and

parental smoking, find:• “The risk of adolescent smoking increased by 28% with

each step down in parental education, and by 30% for each step down in parental household income”

• Conrad et al (1992)– Around ¼ of studies did not support an inverse

relationship between parental SES and childrens’ smoking


Measuring effect of income• How might parental income affect children’s

smoking behaviour?– Higher incomes allow parents to “buy”

circumstances conducive to lower smoking rates• School, peer, neighbourhood effects?

– But also allow greater consumption of all goods, including cigarettes

• Clear that relationship between parental income and youth smoking may be indirect

• Concern that we may not be able to fully observe these indirect channels


Innovations of our approach

• Exploit relatively under-used data from the British Youth Panel (BYP) and British Household Panel Survey (BHPS)

• A more direct assessment of the extent to which parental incomes are associated with youth smoking– Use sibling differences to assess possible causal

effect of income on smoking– Strips out unobservable household effects that

determine smoking and are correlated with income


Data

• British Household Panel Survey (BHPS) / British Youth Panel (BYP)– 1994 to 2001 (waves 4 to 11)– BYP separate data for children aged 11 – 15 in

BHPS– Data from BYP on children’s smoking and

characteristics– Data from BHPS on family backgrounds, SES,

income, smoking status of adults– Track children from BYP into BHPS up to age 18


Sample Sizes

Number of observations

Number of children

Entire sample 7,288 2,467

Sibling sample 1,951 751

• Sibling sample cases where we observe two or more siblings reaching the same age at different points in time

• Used in sibling difference analysis later


Smoking behaviour in the BYP

• Child a smoker if:– Responds with positive figure to question “how

many cigarettes did you smoke in the last seven days?” or

– Self-defines as someone who smokes but not every week

• BHPS question is direct yes/no


BYP evidence on youth smoking: over time

02468

101214161820

Per

cen

tag

e o

f sm

oke

rs

1994 1995 1996 1997 1998 1999 2000 2001


BYP evidence on youth smoking: by household income decile

0

2

4

6

8

10

12

14

16

18

Per

cen

tag

e o

f sm

oke

rs

1 2 3 4 5 6 7 8 9 10


Household income and youth smoking: models

• Simple probit for whether child smokes• Models all condition on: year, age, gender,

region, household composition, mother’s age• In addition:

– Condition on household income quintile and then other family background characteristics


Results

*** = significant at 1% level; ** = significant at 5% level

Baseline smoking probability = 15.6%

Basic Specification Additional controls

Household Income Quintile (Baseline = 4th)

1

2

3

5

Maternal Educational Attainment (Baseline = O Level)

Higher Degree

1st Degree

Vocational

A Level

CSE

None

Adult Smoker?


Results





1 + 4.2%**

2 + 3.5% **

3 + 0.5%

5 - 0.3%


Higher Degree –

1st Degree –

Vocational –

A Level –

CSE –

None –

Adult Smoker? –


Results





1 + 4.2%** + 2.0%

2 + 3.5% ** + 1.5%

3 + 0.5% - 0.3%

5 - 0.3% + 1.5%


Higher Degree – + 4.1%

1st Degree – - 2.6%

Vocational – - 4.1%

A Level – - 0.5%

CSE – + 1.7%

None – + 3.5% **

Adult Smoker? – + 8.5% ***


Sibling Differences

• Income correlated with observable features of the data, e.g. maternal education

• May also be correlated with unobservable features of the data – peer effects, neighbourhood effects, household preferences, etc.

• Therefore examine relationship between changes in income over time and changes in sibling smoking behaviour


Sibling Differences• Focus on siblings who reach same age at different

points in time• 1,030 pairs of siblings identified

SmokerNon-

Smoker

Smoker 59 99

Non-Smoker

73 799

Older Sibling

Yo

un

ger

S

ibli

ng


Model

• Define ∆S = 0 if both siblings smoke/don’t = 1 if only younger smokes = -1 if only older smokes

∆S = f(∆Y, year, age, sex, ∆sex, mother age, age gap between siblings)

NB ∆Y positive if household income rose by the time younger sibling reached same age as older


Results

OLS IV

Coefficient on ∆Y

Robust Std. Error

Significant?


Results

OLS IV

Coefficient on ∆Y

0.041

Robust Std. Error

0.024

Significant? 10% level


Results

OLS IV

Coefficient on ∆Y

0.041 0.134

Robust Std. Error

0.024 0.092

Significant? 10% level No


Conclusions

• Inverse relationship between household income and youth smoking

• Effect fades once we control for maternal education and presence of adult smoker

• Sibling difference results suggest no direct causal relationship between household income and youth smoking

• If anything, higher incomes increase the likelihood of children smoking slightly

IFS Parental Income and Childrens Smoking Behaviour: Evidence from the British Household Panel...

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