The purpose of this paper is to use time-series sales data on domestic cigarettes, imported cigarettes and cigars from 1971 to 2000 for
analyzing cigarette demand in Taiwan and creating a smoking risk information index, based on the number of papers published in the United Daily News (UDN) database, is introduced into a “CBS”system of demand equations. Given the time series properties of variables, a CBS model with
homogeneity and symmetry imposed was estimated. Results indicate that, in the case of Taiwan, the own-price elasticities for domestic and
imported cigarettes, calculated at sample means, are -0.648 and -0.826, respectively. Risk information elasticity is negative on the demand
for domestic cigarettes whereas it is positive for imported cigarettes.