Who reacts to food taxes? How a multiple-selves model can help to explain the effects of food taxes

Sinne Smed, Chiara Lombardini and Leena Lankoski

Chapter 12 in A Modern Guide to Food Economics, 2022, pp 270-296 from Edward Elgar Publishing

Abstract: The limited impact of soft instruments targeting the information environment reasserts the importance of food taxes as a tool for achieving diets that are both healthier and more sustainable. Even though it is possible to eat both healthily and sustainably, empirical evidence shows a negative correlation between these two objectives in currently adopted diets. This poses the challenge of setting food taxes that are able to address simultaneously these two objectives. We use the insights from behavioural economics and psychology to develop a utility-maximization, multiple-selves model that incorporates various key motives driving food consumption choices. We apply the model to food choice in the case in which some food characteristics are of a public good character while others are of a more private good character. This model helps us understand how these multiple selves affect the price elasticity of demand and therefore enhance or reduce the consumers' sensitivity to taxes.

Keywords: Development Studies; Economics and Finance; Environment (search for similar items in EconPapers)
Date: 2022
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