Smoking Behavior and Rank-Dependent Expected-Uitility
Schweizerische Zeitschrift für Volkswirtschaft und Statistik / Revue Suisse d'Economie politique et de Statistique / Swiss Journal of Economics and Statistics, Volume 142, Issue 2, 2006, Pages 223-230
Keywords
Rank-Dependent Expected-Utility; smoking; risk; cigarette consumption, information
Abstract
In this note we use the Rank-Dependent Expected-Utility (RDEU) model to analyse how the effect of improved information on smoking risks impacts the consumption of cigarettes. The RDEU model enables us to incorporate the ways individuals perceive smoking risks. We provide conditions for individuals to modify cigarette consumption in the face of improved information, and we show that these conditions depend in particular on the probability of being ill.