In Becker and Murphy’s “rational addicts” model, smokers are perfectly aware of the potential for smoking to cause addiction, and they take this into account when deciding whether or not to smoke. Suppose a new technology—such as a nicotine patch—has just been invented which makes quitting smoking much easier (less costly) furan addict. If Becker and Murphy’s model is correct, what effects would you expect this invention to have on people’s smoking behavior? Would your answer be different for young people and older people?
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