title: [Demand for cigarettes and tax increases in El Salvador].
abstract: OBJECTIVE
  Analyze short- and long-term elasticities of demand for cigarettes in El Salvador as a tool for supporting recommendations on tax increases to reduce prevalence and consumption through price increases.
  
  
  METHODS
  Demand for cigarettes in El Salvador was analyzed through an econometric time-series model using a database from El Salvador's General Directorate of Internal Taxes (DGII) and the General Directorate of Statistics and Census (DIGESTYC). The analysis period was quarterly: 2000Q1-2012Q4. The usual tests were done to prevent a spurious econometric estimation. It was found that the variables volume sales, actual sale prices, and actual per capita income exhibited first-order cointegration; this result makes it possible to use an error correction model with short- and long-term elasticity estimates.
  
  
  RESULTS
  Only long-term elasticities were found to be statistically significant to 5%. Results show long-term price elasticity (5 quarters) of -0.9287 and income price elasticity of 0.9978.
  
  
  CONCLUSIONS
  Absolute price elasticity is somewhat high, although it is within the levels estimated in other studies in low per-capita income countries. A tax increase from a base amount of US$1.04 per pack of 20 cigarettes to US$1.66 within three years would reduce demand by 20% to 31% and would increase tax revenues by 9% to 22%.
authors.affiliation: Interamerican Heart Foundation, Buenos Aires, Argentina.
authors.forename: Alejandro
authors.initials: A
authors.lastname: Ramos-Carbajales
authors.affiliation: Universidad Torcuato Di Tella, Buenos Aires, Argentina.
authors.forename: Martín
authors.initials: M
authors.lastname: González-Rozada
authors.affiliation: Universidad de la República de Uruguay, Montevideo, Uruguay.
authors.forename: Hugo
authors.initials: H
authors.lastname: Vallarino
mesh_terms: D003132:Commerce / Q000191:economics*; D004544:El Salvador; D006801:Humans; D012907:Smoking / Q000191:economics; D000074606:Smoking Prevention / Q000191:economics; D013660:Taxes; D062789:Tobacco Products / Q000191:economics* / Q000706:statistics & numerical data*