DETERMINANTS OF HOUSEHOLD TOBACCO EXPENDITURE IN VIETNAM: EMPIRICAL EVIDENCE FROM A CENSORED REGRESSION MODEL

Abstract

This study uses data from the 2020 Vietnam Household Living Standards Survey (VHLSS) covering 7,776 households to examine the determinants of tobacco expenditure using a Tobit model. The results show that household tobacco spending is shaped by multiple factors related to the household head’s characteristics, household composition, and socio-economic conditions. Households headed by women and those with more educated household heads tend to spend less on tobacco, whereas the household head’s age and marital status are associated with higher tobacco expenditure. Notably, while larger household size increases overall spending, the presence of children under six and older members (aged 65 and above) is linked to lower tobacco expenditure, suggesting a dampening effect on tobacco-related outlays. From an economic and behavioral perspective, higher-income households, urban residents, and households with alcohol consumption tend to spend more on tobacco, indicating complementarity between risky consumption behaviors. Based on these findings, the study draws policy implications, including tax and price adjustments, targeted health education interventions, and integrated control strategies addressing both tobacco and alcohol use.