The Effects of a Fat Tax on Dairy Products

Hayley Chouinard (), David E. Davis, Jeffrey LaFrance () and Jeffrey Perloff

No 25078, CUDARE Working Papers from University of California, Berkeley, Department of Agricultural and Resource Economics

Abstract: We apply an incomplete demand system to supermarket scanner data to estimate the effects of a fat tax on dairy products for different demographic groups. We find own-price elasticities of demand are relatively inelastic and vary little across groups. A fat tax may be an effective means to raise revenue, but will not result in a significant reduction in fat consumption. The welfare effects associated with a fat tax are large and vary greatly across demographic groups. These fat taxes are regressive in nature, as the elderly and poor suffer greater welfare losses.

Keywords: Demand and Price Analysis; Livestock Production/Industries; Public Economics (search for similar items in EconPapers)
Pages: 42
Date: 2005
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Citations: View citations in EconPapers (6)

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Working Paper: The Effects of a Fat Tax on Dairy Products (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ucbecw:25078

DOI: 10.22004/ag.econ.25078

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