International Development
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One of the major aims of implementing a national health insurance program in Taiwan in 1995 was to provide financial risk protection to the country's 23 million citizens. Households may differ in how they allocate the resources freed up and available to them as a result of health insurance. This study presented by Jui-fen Rachel Lu aims to evaluate the impact of social insurance on household consumption patterns.

About the Speaker

Jui-fen Rachel Lu, ScD, is a professor in the Department of Health Care Management and dean of the College of Management at Chang Gung University in Taiwan, where she teaches comparative health systems, health economics, and health care financing. Her research focuses on equity issues in Taiwan's health care system; the impact of the National Health Insurance program on the health care market and household consumption patterns; and comparative health systems in the Asia-Pacific region. She earned her BS from National Taiwan University, and her MS and ScD from Harvard University.

Lu has served as a member of various government committees dealing with health care issues in Taiwan, and is the recipient of various awards. She is the author of Health Economics, and has published papers in journals including Health Affairs, Medical Care, and Journal of Health Economics. Her detailed CV can be found online.

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Jui-fen Rachel Lu Professor, Department of Health Care Management Speaker Chang Gung University, Taiwan
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As China's economy grows so does the prevalence of social inequality. In a YaleGlobal Online article, a team of Shorenstein APARC China experts says the country must invest more now in education and public health programs for its rural children or it will face major growth challenges in the near future.

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YaleGlobal Online
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Karen Eggleston
Karen Eggleston
Jean C. Oi
Scott Rozelle
Ang Sun
Ang Sun
Xueguang Zhou

Over the last hundred years, the cigarette has become a pillar of consumer life in China and many parts of the world. In 2010, the Chinese tobacco industry produced over two trillion cigarettes, generating over U.S. $90 billion in taxes and profits. Over 300 million Chinese citizens now use cigarettes every day, and tobacco kills 90 times more people each year than HIV/AIDS in China.

How has the cigarette become so integrated into the fabric of everyday life across the People’s Republic of China?

The importance of answering this question is unmistakable, but very little historical research and writing has examined China’s cigarette industry from the mid-20th century to the present. To get to the heart of this question, historians, health policy specialists, sociologists, anthropologists, business scholars, and other experts will meet Mar. 26 and 27 at the new Stanford Center at Peking University for a conference organized by the Asia Health Policy Program. They will examine connections intricately woven over the past 60 years between marketing and cigarette gifting, production and consumer demand, government policy and economic profit, and many other dimensions of China’s cigarette culture.

Stanford Center at Peking University

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Life expectancy at aged 65 is remarkably similar in the three Chinese cities of Hong Kong, Shanghai, and Taipei, even though the cities differ in levels of socioeconomic development, health systems, and other factors. Edward Jow-Ching Tu will discuss research that aims to understand this phenomenon. Despite unprecedented increases in life expectancy and attainment of similar current levels of life expectancy, the cities differ in the contributions of changes in major causes of death to the improvements in life expectancy among the elderly. Tu and colleagues have explored several possible determinants of these different patterns and trends in the three cities, including socioeconomic development, health service delivery systems, cause-of-death classification systems, and competing risks from cardiovascular disease and other diseases. Their analysis suggests that the effect of equity of health service delivery has become more important over time.

Edward Jow-Ching Tu is a senior lecturer of demography in the Division of Social Science at Hong Kong University of Science and Technology. His work is focused on the impact of fertility, mortality, and migration on socio-economic changes in East Asia countries with special emphasis on nations experiencing a transition from planned economy to market economy; on causes and impacts of mortality changes and health transition on aging societies; and on the causes of lowest-low fertility in many East Asia countries. He has several active research projects ongoing in China, Japan, Taiwan, Hong Kong, and Singapore. He holds graduate degress from West Virginia University, the University of Pennsylvania, and the University of Tennessee (Knoxville). Tu has worked extensively in Asia, and has served as an adjunct professor and taught in many universities in China, including Peking University, Peoples University, Nankai Univerity, and Fudan University. He had served as a senior research scientist at the New York State Health Department and as a research fellow (full professor) at the Institute for Social Sciences and Philosophy at Academia Sinica. Tu has also taught at the State University of New York in Albany.

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Edward Jow-Ching Tu Senior Lecturer of Demography at the Division of Social Science Speaker Hong Kong University of Science and Technology
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Sarah Bhatia
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Newly printed “no smoking” signs went up across China when the government rolled out a nationwide public indoor smoking ban in May 2011. A sticky gray layer of smoke residue now coats many signs, representing the challenges China’s growing tobacco-control movement faces against a multibillion-dollar government-run industry and deeply embedded social practices.

How has the cigarette become so integrated into the fabric of everyday life across the People’s Republic of China (PRC)?

To get to the heart of this question, historians, health policy specialists, sociologists, anthropologists, business scholars, and other experts met Mar. 26 and 27 in Beijing for a conference organized by Stanford’s Asia Health Policy Program. They examined connections intricately woven over the past 60 years between marketing and cigarette gifting, production and consumer demand, government policy and economic profit, and many other dimensions of China’s cigarette culture.

Anthropologist Matthew Kohrman, a specialist on tobacco in China, led the conference, which was held at the new Stanford Center at Peking University. In an interview, he spoke about the history of China’s cigarette industry, cigarettes and society, and the tobacco-control movement.

The early years

Tobacco first entered China through missionary contact in the 1600s, says Kohrman, but it was not until the early 20th century when cigarettes began gaining popularity. The first cigarette advertising was a “confused tapestry” of messages as marketers figured out what spoke to the public. “There were just as many images of neo-Confucian filial piety as there were of cosmopolitan ‘modern women,’” says Kohrman.

Through improved marketing and aggressive factory building, British American Tobacco and Nanyang Brothers, China’s two largest pre-war firms, helped increase the demand for cigarettes. The Sino-Japanese War (1937–1945) disrupted the cigarette supply, but their popularity had taken hold. Some cigarette firms shifted during the war to the relative safety of southwest China, where tobacco production has remained concentrated ever since.

Post-1949

After the founding of the PRC in 1949, the tobacco industry was nationalized and strong relationships between the central government and cigarette manufacturers in the provinces were formed. Cigarettes also began to be viewed as a part of everyday life. “Ration coupons for cigarettes were issued alongside grain, sugar, and bicycle coupons,” says Kohman. “The Maoist regime legitimized cigarettes as the right of every citizen."

During the Deng Xiaoping era (1978–1997), China’s cigarette industry really took off as manufacturers competed with one another for foreign currency to purchase cutting-edge European equipment and newer varieties of tobacco seed stock. Increased production and the return of full-scale advertising fueled greater consumer demand, and manufacturers began producing more and more varieties of cigarette. Vendors displayed glass cases filled with a colorful patchwork of cigarette packs bearing names like Panda, Double Happiness, and Red Pagoda.

The tobacco industry remained under government control as other industries privatized in the 1980s and 1990s. Party-state management of the cigarette became even more centralized in the early 1980s with the creation of the China Tobacco Monopoly Administration and its parallel external counterpart, the China Tobacco Corporation.

Since 1949, provincial protectionism has marked the cigarette market. It is now possible to purchase Beijing cigarettes in Kunming, Chengdu brands in Shanghai, and so on, but to distribute cigarettes in another province, a manufacturer must cut a deal with provincial government officials. Provincial administrations are loath to cut such deals because central government policy dictates that the portion of cigarette sales tax which does not go to the central government always is channeled to the finance bureau of the province of original production. China’s 2001 entry into the World Trade Organization opened the market ever so slightly to international brands like Marlboro and Kent, but domestic brands continue to dominate because of fierce protectionism.

...If it chooses to do so, China is in a position to lead and change the landscape in a very profound way.
-Matthew Kohrman, Professor of Anthropology, Stanford

A new era

In 2003, the World Health Organization established the first global health treaty, the Framework Convention on Tobacco Control (FCTC). Although the United States still has not yet ratified the FCTC, China signed the treaty in 2003 and ratified it in 2005. Kohrman says China’s tobacco industry giants fear competition from international cigarette brands more than they worry about tobacco-control measures related to the FCTC.

Nonetheless, the FCTC ushered in a new era of public health research about tobacco and has helped increase public awareness about the dangers of smoking. New restrictions have been imposed on print and television advertising for cigarettes, and international organizations, such as the Bloomberg Family Foundation, have begun funding anti-tobacco work in China.

A big challenge to tobacco-control campaigns, says Kohrman, is the sheer amount of money that tobacco companies have available for marketing. “In 2010, China’s tobacco industry posted profits in excess of U.S. $90 billion—that’s huge. Tobacco control research and advocacy now annually receive a few million dollars, and much of that is coming through outside funders, which have very specific projects in mind.”

China’s tobacco advertisers have adapted to the new restrictions that prevent them from openly promoting cigarettes in the media. They have instead moved to point-of-sale and soft-marketing tactics, including misinformation campaigns about the “dangers” of quitting smoking. “The actual expenditure on marketing probably hasn’t dropped very much,” says Kohrman.

Cigarettes and society

Strong marketing and the legitimization of cigarettes as a part of everyday life have led to the deep integration of cigarettes into Chinese society. While only 3 to 4 percent of women in China smoke, cigarettes are an important part of male identity and social mobility. The wide range of cigarette brands has led to the growth of high-end varieties favored by businessmen and politicians, with some brands costing as much as $50 a pack. The custom of cigarette gifting has existed in China for decades, and it is difficult for a young man to turn down a package of cigarettes from a senior colleague or supervisor.

There is also the fact that nicotine is highly addictive, and quitting is difficult in an environment where smoking cigarettes is socially sanctioned. Kohrman says, “When you take an incredibly addictive substance like nicotine and throw it into the mix of all of these norms and customs, it creates a pretty toxic brew.”

The future?

Tobacco control presents a formidable challenge in China, one that requires understanding the historical context and complex dimensions of the cigarette industry. “Cigarettes have been insinuated into so many aspects of daily life across China, and the market for this product has now become so closely enmeshed with matters of government finance and operations,” says Kohrman.

What happens in China could have implications for the entire world. “There’s a tobacco-induced human annihilation unfolding right now in almost every country and questions about how society and Big Tobacco are enmeshed, and how cigarette culture and government finance have become mutually supportive are pivotal,” says Kohrman. “Every country except Bhutan has legalized cigarette sales and is subject to many of the same general issues as China—only in China they’re on a much larger scale. But if it chooses to do so, China is in a position to lead and change the landscape in a very profound way.”   

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