Health or Taxes: Which Is More Effective at Reducing Consumption of Sugar-Sweetened Beverages?

Abstract

This research investigates the effect of imposing a tax on sugar-sweetened beverages (SSBs) on the likelihood of purchasing SSBs. We design and test an experimental framework that examines this and the effects of providing an explanation about the presence of an SSB tax and information about the negative health effects of consuming SSBs. Consistent with Elbel, Taksler, Mijanovich, Abrams, and Dixon (2013) and Taylor, Kaplan, Villas-Boas, and Jung (2019), we find that imposing a tax, in addition to increasing the conspicuousness of the tax by explaining the presence of a tax (and in some cases, the negative health effects) reduces the likelihood of purchasing an SSB anywhere from 8.39% to 18.15%. We contribute to the public health and tax policy literature by testing consumer choice in a controlled experimental setting and considering the effect of individual differences on the choice to purchase SSBs. Imposing a tax on SSBs may be an effective tool for decreasing SSB consumption that is made more effective when the tax is conspicuous.

Citation

Morrow, M.L., Suher, J. and West, A. (2023), "Health or Taxes: Which Is More Effective at Reducing Consumption of Sugar-Sweetened Beverages?", Hasseldine, J. (Ed.) Advances in Taxation (Advances in Taxation, Vol. 30), Emerald Publishing Limited, Leeds, pp. 145-195. https://doi.org/10.1108/S1058-749720230000030005