Taxes, Subsidies, and Advertising Efficacy in Changing Eating Behavior: An Experimental Study

Using a lab experiment with 258 adult non-student participants, we examined whether unhealthy foods taxes, healthy foods subsidies, anti-obesity advertising, and healthy foods advertising have an impact on changing consumers' choices of lunch items and the nutrient content of their choices for a selected meal. A difference-in-difference regression model was used to determine the efficacy of the various policy treatments. The results indicate that the unhealthy foods tax, healthy foods advertising, and unhealthy foods tax combined with anti-obesity advertising significantly reduced the content of some nutrients of concern, such as calories, calories from fat, carbohydrates, and cholesterol in meal selections. We also find that when combined with healthy foods subsidy, the healthy foods advertising has very little effect on nutrient consumption; the anti-obesity advertising on its own, however, is not efficient at changing dietary behavior. We discuss the policy implications of our findings and venues for future research.