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The impact of tax reforms designed to encourage healthier grain consumption

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  • Nordström, Jonas
  • Thunström, Linda

Abstract

In this paper, we simulate the effects of tax reforms aimed at encouraging healthier grain consumption. We use a rich data set on household grain consumption in 2003 from the market research institute GfK Sweden, combined with information on the nutritional content of the consumption. We estimate behavioral parameters, which are used to simulate the impact on the average household of tax reforms entailing either a subsidy on commodities particularly rich in fiber or a subsidy of the fiber density in grain products. Our results suggest that to direct the fiber intake towards nutritional recommendations, reforms with a substantial impact on consumer prices are required. Regardless of the type of subsidy implemented, the increase in the intake of fiber is accompanied by unwanted increases in nutrients that are often overconsumed: fat, salt and sugar. Funding the subsidies by taxing these nutrients, or less healthy commodities, helps to counteract such developments.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Health Economics.

Volume (Year): 28 (2009)
Issue (Month): 3 (May)
Pages: 622-634

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Handle: RePEc:eee:jhecon:v:28:y:2009:i:3:p:622-634

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Web page: http://www.elsevier.com/locate/inca/505560

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Keywords: Consumer economics Food Health Taxation;

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Citations

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Cited by:
  1. Nordström, Jonas & Thunström, Linda, 2011. "Can targeted food taxes and subsidies improve the diet? Distributional effects among income groups," Food Policy, Elsevier, vol. 36(2), pages 259-271, April.
  2. Ryota Nakamura & Marc Suhrcke & Daniel John Zizzo, 2014. "A Triple Test for Behavioral Economics Models and Public Health Policy," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 14-01, School of Economics, University of East Anglia, Norwich, UK..
  3. Sabine Duvaleix-Treguer & Abdelhakim Hammoudi & Lamia Rouached & Louis Georges Soler, 2012. "Firms' responses to nutritional policies," Working Papers 43008, Institut National de la Recherche Agronomique, France.
  4. Jensen, Jørgen Dejgård & Smed, Sinne, 2013. "The Danish tax on saturated fat – Short run effects on consumption, substitution patterns and consumer prices of fats," Food Policy, Elsevier, vol. 42(C), pages 18-31.
  5. Nordström, Jonas & Thunström, Linda, 2009. "Economic Policies for Healthier Food Intake: The Impact on Different Household Categories," Working Papers 2009:14, Lund University, Department of Economics.
  6. Kaisa Kotakorpi & Tommi Härkänen & Pirjo Pietinen & Heli Reinivuo & Ilpo Suoniemi & Jukka Pirttilä, 2011. "The Welfare Effects of Health-based Food Tax Policy," CESifo Working Paper Series 3633, CESifo Group Munich.
  7. Nordström, Jonas & Thunström, Linda, 2009. "The Impact on Different Household Types of Economic Policies Designed to Increase the Fiber Intake from Grain Consumption," HUI Working Papers 22, HUI Research.
  8. Ehmke, Mariah D. & Willson, Tina M. & Schroeter, Christiane & Hart, Ann Marie & Coupal, Roger H., 2009. "Obesity Economics for the Western United States," Western Economics Forum, Western Agricultural Economics Association, vol. 8(02).
  9. Gustavsen, Geir Wæhler & Rickertsen, Kyrre, 2013. "Adjusting VAT rates to promote healthier diets in Norway: A censored quantile regression approach," Food Policy, Elsevier, vol. 42(C), pages 88-95.
  10. Irz, Xavier & Leroy, Pascal & Réquillart, Vincent & Soler, Louis-Georges, 2014. "Economic assessment of nutritional recommendations," TSE Working Papers 14-473, Toulouse School of Economics (TSE).
  11. Darmon, N. & Lacroix, A. & Muller, L. & Ruffieux, B., 2011. "Experimental economics shows how food price policies may improve diet while increasing socioeconomic inequalities in nutrition," Working Papers 201104, Grenoble Applied Economics Laboratory (GAEL).
  12. Capacci, Sara & Mazzocchi, Mario, 2011. "Five-a-day, a price to pay: An evaluation of the UK program impact accounting for market forces," Journal of Health Economics, Elsevier, vol. 30(1), pages 87-98, January.

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