Accounting for Product Substitution in the Analysis of Food Taxes Targeting Obesity

Zhen Miao, John Beghin () and Helen Jensen

Staff General Research Papers Archive from Iowa State University, Department of Economics

Abstract: We extend the existing literature on food taxes targeting obesity. We systematically incorporatethe implicit substitution between added sugars and solid fats into a comprehensive food demandsystem and evaluate the effect of taxes on sugars and fats. The approach conditions how foodand obesity taxes affect total calorie intake. The proposed methodology accounts for the abilityof consumers to substitute leaner low-fat and low-sugar items for rich food items within the samefood group. This substitution is integrated into a calibrated demand system in addition to thesubstitution among food groups, using recent food intake data and existing demand elasticities.Simulations of taxes on added sugars and solid fat show that their impact on consumptionpatterns is understated and the induced welfare loss is overstated when abstracting from thesubstitution possibilities within food groups.

Keywords: sugar; obesity; fat; food demand; health policy nutrition; low-fat and low-sugar substitutes; sweeteners tax. (search for similar items in EconPapers)
JEL-codes: I18 Q18 (search for similar items in EconPapers)
Date: 2012-11-28
New Economics Papers: this item is included in nep-acc and nep-cmp
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published in Health Economics 2013, vol. 22 no. 11, pp. 1318-1343

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http://www2.econ.iastate.edu/papers/p12211-2010-12-16.pdf (application/pdf)
http://www.card.iastate.edu/products/publications/synopsis/?p=1151

Related works:
Journal Article: ACCOUNTING FOR PRODUCT SUBSTITUTION IN THE ANALYSIS OF FOOD TAXES TARGETING OBESITY (2013)
Working Paper: Accounting for Product Substitution in the Analysis of Food Taxes Targeting Obesity (2013)
Working Paper: Accounting for Product Substitution in the Analysis of Food Taxes Targeting Obesity (2011)
Working Paper: Accounting for Product Substitution in the Analysis of Food Taxes Targeting Obesity (2011)
Working Paper: Accounting for product substitution in the analysis of food taxes targeting obesity (2011)
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