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Taxes and subsidies to change eating habits when information is not enough: an application to fish consumption

Author

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  • Stéphan Marette

    ()

  • Jutta Roosen

    ()

  • Sandrine Blanchemanche

    ()

Abstract

A calibrated model is used to determine the welfare impacts of various regulatory instruments for improving health. The results of a lab experiment are integrated in a partial equilibrium model representing demands for two kinds of fish, one with higher nutritional benefits (canned sardines) and one with higher contamination risks (canned tuna) in France. In the laboratory, information about health effects leads to a statistically significant decrease (increase) in the willingness to pay for tuna (sardines). Simulations with the laboratory results show that, for most cases, a per-unit tax on tuna and a per-unit subsidy on sardines without any information revealed to consumers lead to the highest welfare, because both the tax and subsidy directly internalize health characteristics. The information policy combined with a per-unit tax on tuna and a per-unit subsidy on sardines is socially profitable only if a large proportion of consumers (greater than 95%) receives health information.
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Suggested Citation

  • Stéphan Marette & Jutta Roosen & Sandrine Blanchemanche, 2008. "Taxes and subsidies to change eating habits when information is not enough: an application to fish consumption," Journal of Regulatory Economics, Springer, vol. 34(2), pages 119-143, October.
  • Handle: RePEc:kap:regeco:v:34:y:2008:i:2:p:119-143
    DOI: 10.1007/s11149-008-9057-0
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Kentaro Kawasaki & Takeshi Fujie & Kentaro Koito & Norikazu Inoue & Hiroki Sasaki, 2012. "Conservation Auctions and Compliance: Theory and Evidence from Laboratory Experiments," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 52(2), pages 157-179, June.
    2. Stéphan Marette & Jayson L. Lusk & Jutta Roosen, 2010. "Welfare Impact of Information with Experiments: The Crucial Role of the Price Elasticity of Demand," Economics Bulletin, AccessEcon, vol. 30(2), pages 1585-1593.
    3. Rousu, Matthew C. & Marette, Stéphan & Thrasher, James F. & Lusk, Jayson L., 2014. "The economic value to smokers of graphic warning labels on cigarettes: Evidence from combining market and experimental auction data," Journal of Economic Behavior & Organization, Elsevier, vol. 108(C), pages 123-134.
    4. Marette Stéphan & Roosen Jutta & Blanchemanche Sandrine, 2011. "The Combination of Lab and Field Experiments for Benefit-Cost Analysis," Journal of Benefit-Cost Analysis, De Gruyter, vol. 2(3), pages 1-36, August.
    5. Marette, Stéphan & Millet, Guy, 2014. "Economic benefits from promoting linseed in the diet of dairy cows for reducing methane emissions and improving milk quality," Food Policy, Elsevier, vol. 46(C), pages 140-149.
    6. Frank van Tongeren & John Beghin & Stéphane Marette, 2009. "A Cost-Benefit Framework for the Assessment of Non-Tariff Measures in Agro-Food Trade," OECD Food, Agriculture and Fisheries Papers 21, OECD Publishing.
    7. Anne-Célia Disdier & Stéphan Marette, 2012. "Taxes, minimum-quality standards and/or product labeling to improve environmental quality and welfare: Experiments can provide answers," Journal of Regulatory Economics, Springer, vol. 41(3), pages 337-357, June.

    More about this item

    Keywords

    Fetal development; Health; Information; Pregnancy; Regulation; Taxation; C9; H2; I1; L5;

    JEL classification:

    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • I1 - Health, Education, and Welfare - - Health
    • L5 - Industrial Organization - - Regulation and Industrial Policy

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