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Implications of a sugar-sweetened beverage (SSB) tax when substitutions to non-beverage items are considered

Eric A. Finkelstein, Chen Zhen, Marcel Bilger, James Nonnemaker, Assad M. Farooqui and Jessica Todd ()

Journal of Health Economics, 2013, vol. 32, issue 1, 219-239

Abstract: Using the 2006 Homescan panel, we estimate the changes in energy, fat and sodium purchases resulting from a tax that increases the price of sugar-sweetened beverages (SSBs) by 20% and the effect of such a tax on body weight. In addition to substitutions that may arise with other beverages, we account for substitutions between SSBs and 12 major food categories. Our main findings are that the tax would result in a decrease in store-bought energy of 24.3kcal per day per person, which would translate into an average weight loss of 1.6 pounds during the first year and a cumulated weight loss of 2.9 pounds in the long run. We do not find evidence of substitution to sugary foods and show that complementary foods could contribute to decreasing energy purchases. Despite their significantly lower price elasticity, the tax has a similar effect on calories for the largest purchasers of SSBs.

Keywords: Sugar-sweetened beverage tax; Obesity; Nutrient demand models; Instrumental variables (search for similar items in EconPapers)
JEL-codes: I12 I19 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhecon:v:32:y:2013:i:1:p:219-239

DOI: 10.1016/j.jhealeco.2012.10.005

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Journal of Health Economics is currently edited by J. P. Newhouse, A. J. Culyer, R. Frank, K. Claxton and T. McGuire

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