Selection Effects and Heterogeneous Demand Responses to the Berkeley Soda Tax Vote

Jakina Debnam
Authors registered in the RePEc Author Service: Jakina Debnam Guzman

American Journal of Agricultural Economics, 2017, vol. 99, issue 5, 1172-1187

Abstract: Early evidence from household-level surveys suggests that the one-cent-per-ounce tax on sugar-sweetened beverages that took effect on March 1, 2015, in Berkeley, California, has decreased consumption of sugar-sweetened beverages dramatically. Even if these findings are robust, the public policy implications of expanding the Berkeley soda tax policy to a national level are complicated by selection effects inherent in the populations of both voters and consumers. We find that consumption responses related to the tax interact nontrivially with consumer heterogeneity. Some of these responses directly counter the public policy goals of a soda tax. For example, high-consuming households are less price sensitive and therefore less responsive to price changes following a tax. Further, “reactance” among high-consuming populations led to increases in soda consumption immediately following the passage of the tax, partially mitigating reductions in soda consumption.

Keywords: Behavioral economics; public policy; sugar-sweetened beverage tax; reactance (search for similar items in EconPapers)
JEL-codes: D12 H00 I18 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (27)

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Working Paper: Selection Effects and Heterogeneous Demand Responses to the Berkeley Soda Tax Vote (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:oup:ajagec:v:99:y:2017:i:5:p:1172-1187.

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