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The Impact of Tax Reforms Designed to Encourage a Healthier Grain Consumption

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  • Nordström, Jonas

    ()
    (Institute of Food and Resource Economics)

  • Thunström, Linda

    ()
    (The Swedish Retail Institute)

Abstract

In this paper, we simulate the effects of taxes on products and/or nutrients aimed at encouraging a healthier grain consumption. To carry out the analysis, we use a rich data set on household consumption of grain products, combined with information about the nutritional content of the products. We estimate behavioural parameters that are used to simulate the impact on the average household of different types of tax reforms; entailing either a subsidy on commodities particularly rich in fibre or a subsidy of the fibre density in grain products. Our results suggest that to direct the fibre intake of the average household towards nutritional recommendations, reforms with a substantial impact on consumer prices are required. Our results also imply that subsidizing the fibre density is more cost-efficient than reducing the VAT on commodities rich in fibre. Regardless of the type of subsidy imposed, the increase in the fibre intake is accompanied by unwanted increases in the nutrients that are often over consumed; fat, saturated fat, salt and sugar and added sugar. Funding the subsidies by taxing these nutrients, or less healthy commodities, prevents such developments.

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Bibliographic Info

Paper provided by HUI Research in its series HUI Working Papers with number 11.

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Length: 44 pages
Date of creation: 06 Nov 2007
Date of revision:
Publication status: Published as Nordström, Jonas and Linda Thunström, 'The Impact of Tax Reforms Designed to Encourage a Healthier Grain Consumption' in Journal of Health Economics, 2009, pages 622-634.
Handle: RePEc:hhs:huiwps:0011

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Keywords: Consumer economics; food; health; taxation;

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References

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Citations

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Cited by:
  1. Duvaleix-Treguer, Sabine & Hammoudi, Hakim & Rouached, Lamia & Soler, Louis-Georges, 2010. "Firms’ Responses To Nutritional Policies," 115th Joint EAAE/AAEA Seminar, September 15-17, 2010, Freising-Weihenstephan, Germany 116399, European Association of Agricultural Economists;Agricultural and Applied Economics Association.
  2. Kaisa Kotakorpi & Pirjo Pietinen & Jukka Pirttila & Heli Reinivuo & Ilpo Suoniemi, 2012. "The Welfare Effects of Health-Based Food Tax Policy," Discussion Papers 81, Aboa Centre for Economics.
  3. Nordström, Jonas & Thunström, Linda, 2011. "Can targeted food taxes and subsidies improve the diet? Distributional effects among income groups," HUI Working Papers 44, HUI Research.
  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. 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.
  6. 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.
  7. 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).
  8. 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).
  9. 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..
  10. 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.
  11. 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.
  12. 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).

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