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Forty-six states, the District of Columbia, and five U.S. territories receive annual payments from tobacco manufacturers that are parties to the tobacco Master Settlement Agreement (MSA). In 2008, those payments totaled over $8 billion.
Under the terms of the MSA, those payments are adjusted annually to account for changes in the volume of cigarette sales in the United States of participating manufacturers. Because CBO estimates that enacting this legislation would result in lower consumption of tobacco products, CBO estimates that the annual payments to states under the MSA also would decline by over $150 million over the 2010-2014 period. A decline in smoking among pregnant individuals is expected to result in a reduction of low-weight births. As a result, state spending for Medicaid would decrease by an estimated $15 million over the 2010-2014 period, with additional savings in subsequent years.

Studies on demand for cigarettes have applied different economic models to two different types of data, aggregated and. individual level. Analysing each of two data-types has some advantages and disadvantages. The aggregate data are either time-series data or pooled cross-sectional and time-series data. High correlation among many of the key independent variables and prices can be a problem with time-series data. Consequently, estimates of the impact which prices and other factors have on demand can be sensitive to the inclusion and exclusion of the other variables.
The problem with using the pooled data is the measurement of cigarette consumption. Using these data, smoking is normally measured by annual state-level tax-paid cigarette sales. Both cross-border shopping between the neighbour states and the long-distance smuggling from low-tax to high-tax states can occur due to differences in taxes on cigarettes. Failure to account for this will produce upward-biased estimates of the impact of price on cigarette demand.
Finally, with aggregate data the demand and supply of cigarettes need to be modelled simultaneously since cigarette price, sale and consumption are simultaneously determined. In contrast, the use of individual-level data can ease some of the problems associated with aggregate data such as simultaneous biases resulting from the price and consumption, and multicollinearity between cigarette prices and other factors affecting the demand. In addition, using individual-level data can allow researchers to study the price responsiveness of different subpopulation groups such as those based on income, education, and age. The problem with individuallevel data is the accuracy with which consumption of cigarettes is measured. Self-reported consumption is typically under reported.

In Turkey, three basic types of cigarettes are marketed: Oriental blend, American blend and English blend. TEKEL produces all three types, while the two private companies produce only the American blend.
A national survey undertaken in 1988 reported that the overall prevalence of smoking among adults (age 15+ years) was 43 percent, with prevalence among males being much higher than among females, and the average starting age was falling.
Currently, 5 billion packs (100 000 tonnes equivalent) of cigarettes are consumed in Turkey annually. Over the last 30 years, the adult population has nearly doubled, with consumption increasing by almost 250 percent. The current per capita consumption rate is 2.55 kg/year, or more than one third of a pack per day per person. It is estimated that 70 000 to 100 000 people die from smoking-related health problems each year.