Time Use and Food Taxation in Spain
We evaluate the welfare impact of changing the VAT on food in a context in which households can produce home meals for own consumption that compete with meals served in restaurants. Home production of meals requires the combination of food and time inputs. The fiscal treatment in home production of both the inputs and the final product differs from market production of meals, generating different channels of inefficiency. We calibrate a simple general-equilibrium model for the Spanish economy that identifies three types of consumers according to their income, and simulate the effects of some experiments related to how food is taxed. The results suggest that if we focus only on aggregate welfare, the model fails to capture important distributional issues. We also present some caveats to previous simulation results on aggregate welfare that are related to the importance of the elasticity of substitution between food and time in the household production of meals.
Volume (Year): 65 (2009)
Issue (Month): 3 (September)
|Contact details of provider:|| Web page: https://www.mohr.de/fa|
|Order Information:|| Postal: Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Keshab Bhattarai, 2007. "Welfare impacts of equal-yield tax reforms in the UK economy," Applied Economics, Taylor & Francis Journals, vol. 39(12), pages 1545-1563.
- Gronau, Reuben, 1977.
"Leisure, Home Production, and Work-The Theory of the Allocation of Time Revisited,"
Journal of Political Economy,
University of Chicago Press, vol. 85(6), pages 1099-1123, December.
- Reuben Gronau, 1976. "Leisure, Home Production and Work--The Theory of The Allocation of Time Revisited," NBER Working Papers 0137, National Bureau of Economic Research, Inc.
- Auerbach, Alan J. & Hines, James Jr., 2002. "Taxation and economic efficiency," Handbook of Public Economics,in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 3, chapter 21, pages 1347-1421 Elsevier.
- Alan J. Auerbach & James R. Hines Jr., 2001. "Taxation and Economic Efficiency," NBER Working Papers 8181, National Bureau of Economic Research, Inc.
- Dan Anderberg & Alessandro Balestrino, 2000. "Household Production and the Design of the Tax Structure," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 7(4), pages 563-584, August.
- Boskin, Michael J., 1975. "Efficiency aspects of the differential tax treatment of market and household economic activity," Journal of Public Economics, Elsevier, vol. 4(1), pages 1-25, February. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:mhr:finarc:urn:sici:0015-2218(200909)65:3_313:tuafti_2.0.tx_2-u. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Wolpert)
If references are entirely missing, you can add them using this form.