"Can I Hit Your Juul": Examining the Impact of Taxation on Youth Usage of E-Cigarettes

Abstract

There has been a surge in popularity of e-cigarettes in the United States ever since the inception of Juul Labs in 2015, with self-reported usage by high schoolers has reached as high as 28% in 2019. The U.S. government has taken various measures to combat this uptick in youth e-smoking, such as raising the minimum purchasing age to 18 or enacting excise taxes on e-cigarettes. This paper examines the causal effect of e-cigarette taxation on youth consumption behavior. By using a national high school survey and analyzing quasi-experimental variations between state policies, we find that taxation leads to a decreased likelihood of students using e-cigarettes at lower frequencies (i.e. between one to six days per month). Within the premise of discouraging negative externalities, taxation may have a significant impact on youth in deterring adoption of low-frequency e-cigarette usage. Such a finding has implications for future policy choices by states seeking to curb youth e-cigarette smoking.