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Costs of Taxing Sodium: A Lunch Meat Application

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  • Hahn, William F.
  • Davis, Christopher G.

Abstract

The current American diet contains excessive amounts of sodium and saturated fat, which are high risk factors for cardiovascular disease (US Dietary Guidelines for Americans 2010). Recently, the Centers for Disease Control and Prevention (CDC) reported lunch meats to be the second highest source of sodium in American diets. Using 2006 Nielsen Homescan data and an AIDS framework, this study estimates the demand for eight disaggregated lunch meat products to determine the welfare costs associated with consuming these meat products. The estimated welfare analysis revealed that a tax rate that increases the price of the highest-sodium lunch meat (pepperoni) by 25 percent can reduce lunch meat consumption as well as lower the intake of lunch meat sodium by 20 percent.

Suggested Citation

  • Hahn, William F. & Davis, Christopher G., 2014. "Costs of Taxing Sodium: A Lunch Meat Application," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 17(A), pages 1-16, March.
    • Handle: RePEc:ags:ifaamr:164596
    DOI: 10.22004/ag.econ.164596
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    References listed on IDEAS

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    4. Kuchler, Fred & Tegene, Abebayehu & Harris, James Michael, 2004. "Taxing Snack Foods: What to Expect for Diet and Tax Revenues," Agricultural Information Bulletins 33607, United States Department of Agriculture, Economic Research Service.
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    Cited by:

    1. Dong, Diansheng & Stewart, Hayden & Dong, Xiao & Hahn, William, 2022. "Quantifying Consumer Welfare Impacts of Higher Meat Prices During the COVID-19 Pandemic," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, vol. 2022(Economic ), April.

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