March 3, 2019

The Tobacconomics Approach to Think Tank Capacity-Building: The ‘Why’ and ‘What’

During the month of March, we’ll be sharing a series of blogs to explain the think tank capacity building project: “Accelerating Progress on Tobacco Taxes in Low‐ and Middle‐Income Countries,” which is funded through the Bloomberg Initiative To Reduce Tobacco Use. You can find a summary of the project here on the Tobacconomics website, but in short, this project aims to build the capacity of economic and fiscal policy think tanks to produce and disseminate high-quality research on the economics of tobacco taxation. We began the project two years ago and in that time, we have established partnerships with 22 think tanks in 17 countries. This series of blogs will explain the “who, what, when, where, why and how” of our team’s approach to capacity building on the economics of tobacco control, including our ‘core competencies’ model, the scoping process, research process and results thus far, lessons learned from our first grant cycle, and lastly, future work.

This first blog will address two important questions our team faced in crafting our approach: the why and what of our capacity building model.

To begin—an initial question we asked ourselves is, Why Capacity Building? Why not continue to undertake research on the economics of tobacco control as individual researchers?

Sustainability. Since a core value of the work we do is sustainability, we thought it vital to make an investment in research that would outlive the term of the grant and our work in any particular region. We also saw that sustainability is difficult to accomplish through one-off research projects, even where collaboration with local researchers was present. We wanted the research to establish roots to weather the periodic cycles of donor interest in the issue.

Engaging Institutions. We also wanted to focus on institutional partnerships rather than contracting with individual researchers. Because skills can be transferred within an institution, and individual researchers may come and go, we wanted to partner with an organization tied to the country, and not dependent on a single researcher. We also wanted to partner with in-country institutions that had demonstrated commitment to informing policies of the country.

The Need for Local Evidence. Another aspect that was key is the relative scarcity of local evidence and analysis on the topic. Although internationally-branded research has a certain appeal in some countries, high-quality, locally-generated research often has the most credibility and gains the most traction in moving an issue forward.

Engaging Economists. We also sought out research institutions that focused on economic and fiscal policy, since our work is all about the economic impacts of tobacco tax systems—not just projecting the impacts of tax changes on revenues and consumption, but also understanding more broadly the impacts on employment, economic growth, illicit trade, and the health and economic costs of tobacco use in any given country.

The second important question we had to answer: What capacities are we seeking to build?

Because most of the think tanks we partner with have never worked in the economics of tobacco, we set out to identify what questions we wanted the research to tackle through economic analysis. Roughly divided by for/against arguments for tobacco tax reforms, we developed the following six core competencies of analysis in the economics of tobacco control.

Advancing economic arguments for tax increases:

  1. How will consumers respond to tax increases and other structural reforms?

Core competency –> Demand elasticity estimations using survey and/or time series data

 

  1. How will a given tax increase/reform affect the price of tobacco products and how will this change in price affect government revenues and tobacco consumption?

Core competency –> Simulation modeling of alternative tax structures/rates on government revenues and public health impacts

 

  1. How will tax increases/reforms affect the poor?

Core competency –> Measuring distributional impacts of tax increases

 

  1. What are the health and economic costs of tobacco use and how can tobacco tax increases/reforms address these costs?

Core competency –> Quantifying health and economic costs (direct and indirect) of tobacco use

 

Countering economic arguments against tax increases:

  1. How will tobacco tax increases/reforms affect employment and economic growth?

Core competency –> Macroeconomic impacts of tax increases, e.g., employment, economic growth, supply chain analysis, etc. through I/O, CGE, and other models

 

  1. Do tax increases/reforms cause increases in illicit trade in tobacco?

Core competency –> Understanding the dynamics of illicit trade by quantifying levels of illicit trade, measuring trends, geographical distribution, etc. using primary and secondary data sources

 

Depending on the evidence gaps and policy needs in a given country, our team works with a partner think tank to carry out analysis through training, mentoring and other forms of technical assistance through to production of written products and dissemination of the research. Our third blog will discuss implementation in more detail, but first, the next blog will explain the “who and how” process by which we scoped and selected potential think tank partners. Stay tuned!

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