Sin Tax Salience under Tax-Inclusive Pricing: Experimental Evidence on Informational Effects of Sugar-Sweetened Beverage Taxation

Gyuchan Lee

No 404547, 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri from Agricultural and Applied Economics Association

Abstract: This paper examines how consumers respond to different forms of soda tax information under tax-inclusive pricing. Using a randomized pre–post discrete choice experiment (DCE) in China, we isolate informational effects while holding tax-inclusive prices constant. Difference-in-differences comparisons and mixed logit estimates show that informing consumers that the displayed soda price includes a soda tax reduces regular soda demand relative to a price-only control group, while explicit disclosure of the tax amount produces larger demand reductions and higher implied price elasticity. The estimates suggest that tax information primarily reduces the perceived attractiveness of regular soda, whereas explicit tax disclosure increases price sensitivity. These findings suggest that tax-inclusive pricing alone may not ensure full tax salience and that disclosure design may complement corrective taxation beyond the standard price effect.

Keywords: Food; Consumption/Nutrition/Food; Safety (search for similar items in EconPapers)
Pages: 39
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea26:404547

DOI: 10.22004/ag.econ.404547

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