• There are alternatives to banning sodas

    I still get a lot of crap for not supporting a ban on sodas. I still think it’s a terrible idea. But there are others. “The Effect of Prices on Nutrition: Comparing the Impact of Product- and Nutrient-Specific Taxes“:

    This paper provides an analysis of the role of prices in determining food purchases and nutrition using very detailed transaction-level observations for a large, nationally-representative sample of US consumers over the period 2002-2007. Using product- specific nutritional information, we develop a new method of partitioning the product space into relevant nutritional clusters that define a set of nutritionally-bundled goods, which parsimoniously characterize consumer choice sets. We then estimate a large utility-derived demand system over this joint product-nutrient space that allows us to calculate price and expenditure elasticities. Using our structural demand estimates, we simulate the role of product taxes on soda, sugar-sweetened beverages, packaged meals, and snacks, and nutrient taxes on fat, salt, and sugar. We find that a 20% nutrient tax has a significantly larger impact on nutrition than an equivalent product tax, due to the fact that these are broader-based taxes. However, the costs of these taxes in terms of consumer utility are not higher. A sugar tax in particular is a powerful tool to induce healthier nutritive bundles among consumers.

    We tax alcohol and cigarettes because, in part, we think they are bad for us. If we really believe that sugar, or high fructose corn syrup, is a public health danger then research such as this makes the case that taxing nutrients is a much better idea than banning, or even taxing, products.

    @aaronecarroll

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