IDEAS home Printed from https://ideas.repec.org/p/ags/aaea26/404571.html

Restricting Volume Price Promotions of "Less Healthy" Foods and Beverages

Author

Listed:
  • Nuño-Ledesma, José G.

Abstract

England recently banned volume-based promotions of foods high in fat, sugar, or salt. When these promotions are used to induce market segmentation, removing them can lead to counterintuitive outcomes and frustrate policy goals. To illustrate how, I use a standard nonlinear pricing model where a single-product seller serves two types of buyers. Without regulation, the seller distorts consumption down for low-preference consumers. After regulation; if the seller serves low-types, the strategic under-provision of quantity is not necessary, reducing consumption for high-type buyers but increasing consumption for low-types. When the seller does not serve low-types consumption by high-types remains steady.

Suggested Citation

  • Nuño-Ledesma, José G., 2026. "Restricting Volume Price Promotions of "Less Healthy" Foods and Beverages," 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri 404571, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea26:404571
    DOI: 10.22004/ag.econ.404571
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/404571/files/177572_199080_115232_combined.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.404571?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. José G. Nuño‐Ledesma & Steven Y. Wu & Joseph V. Balagtas, 2025. "Soda taxes versus cup sizes when the retailer practices nonlinear pricing: An experiment," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 73(3), pages 229-246, September.
    2. Brian A Bourquard & Steven Y Wu, 2020. "An Analysis of Beverage Size Restrictions," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(1), pages 169-185, January.
    3. José G. Nuño‐Ledesma & Steven Y. Wu & Joseph V. Balagtas, 2024. "Taxing sugar‐sweetened beverages: A nonlinear pricing approach," American Journal of Agricultural Economics, John Wiley & Sons, vol. 106(2), pages 967-981, March.
    4. Bokhari, Farasat A.S. & Dobson, Paul W. & Morciano, Marcello & Suhrcke, Marc, 2023. "Banning volume discounts to curb excessive consumption: A cautionary tale," European Economic Review, Elsevier, vol. 156(C).
    5. Armstrong, Mark & Rochet, Jean-Charles, 1999. "Multi-dimensional screening:: A user's guide," European Economic Review, Elsevier, vol. 43(4-6), pages 959-979, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. José G. Nuño‐Ledesma & Steven Y. Wu & Joseph V. Balagtas, 2025. "Soda taxes versus cup sizes when the retailer practices nonlinear pricing: An experiment," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 73(3), pages 229-246, September.
    2. Louis Kaplow, 2008. "Optimal Policy with Heterogeneous Preferences," NBER Working Papers 14170, National Bureau of Economic Research, Inc.
    3. Litterscheid, Sina & Szalay, Dezsö, 2014. "Sequential, multidimensional screening," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100621, Verein für Socialpolitik / German Economic Association.
    4. Blackorby, Charles & Szalay, Dezso, "undated". "Regulating a Monopolist with unknown costs and unknown quality capacity," Economic Research Papers 269856, University of Warwick - Department of Economics.
    5. Charles Po-Cheng Huang, 2026. "Screening Workers with Affirmative Action," Papers 2604.00615, arXiv.org, revised Jul 2026.
    6. Herwig Immervoll & Henrik Jacobsen Kleven & Claus Thustrup Kreiner & Nicolaj Verdelin, 2008. "An Evaluation of the Tax-Transfer Treatment of Married Couples in European Countries," EPRU Working Paper Series 08-03, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
    7. Alex Edmans & William Mann, 2019. "Financing Through Asset Sales," Management Science, INFORMS, vol. 65(7), pages 3043-3060, July.
    8. Doh Shin Jeon, "undated". "Relying on the agent in charge of production for project evaluation," Economics Working Papers 623, Department of Economics and Business, Universitat Pompeu Fabra, revised Jan 2006.
    9. Chen, Mark A. & Marquez, Robert, 2009. "Regulating securities analysts," Journal of Financial Intermediation, Elsevier, vol. 18(2), pages 259-283, April.
    10. Stole, Lars A., 2007. "Price Discrimination and Competition," Handbook of Industrial Organization, in: Mark Armstrong & Robert Porter (ed.), Handbook of Industrial Organization, edition 1, volume 3, chapter 34, pages 2221-2299, Elsevier.
    11. Wei Chen & Milind Dawande & Ganesh Janakiraman, 2018. "Optimal Procurement Auctions Under Multistage Supplier Qualification," Manufacturing & Service Operations Management, INFORMS, vol. 20(3), pages 566-582, July.
    12. Donze, Jocelyn & Gunnes, Trude, 2018. "Becoming “We” instead of “I”, identity management and incentives in the workplace," Journal of Economic Behavior & Organization, Elsevier, vol. 148(C), pages 105-120.
    13. Pierangelo Mori, 2008. "Design of Multidimensional Franchise Auctions by an Ignorant Principal," Working Papers - Economics wp2008_13.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
    14. Andre Veiga & E. Glen Weyl, 2011. "Multidimensional Heterogeneity and Platform Design," Working Papers 11-33, NET Institute, revised Nov 2011.
    15. Kokovin, S. & Nahata, B. & Zhelobodko, E., 2011. "All Solution Graphs in Multidimensional Screening," Journal of the New Economic Association, New Economic Association, issue 11, pages 10-38.
    16. Felix Bierbrauer, 2006. "Distortionary Taxation and the Free-Rider Problem," Discussion Paper Series of the Max Planck Institute for Behavioral Economics 2006_6, Max Planck Institute for Behavioral Economics.
    17. Sung Hyun Kim, 2019. "Two-Dimensional Self-Selection of Borrowers," Korean Economic Review, Korean Economic Association, vol. 35, pages 125-161.
    18. Bierbrauer Felix J., 2016. "Effizienz oder Gerechtigkeit?: Ungleiche Einkommen, ungleiche Vermögen und Optimale Steuern," Perspektiven der Wirtschaftspolitik, De Gruyter, vol. 17(1), pages 2-24, April.
    19. Boyer, Pierre C. & Kempf, Hubert, 2020. "Regulatory arbitrage and the efficiency of banking regulation," Journal of Financial Intermediation, Elsevier, vol. 41(C).
    20. Chernomaz, Kirill & Levin, Dan, 2012. "Efficiency and synergy in a multi-unit auction with and without package bidding: An experimental study," Games and Economic Behavior, Elsevier, vol. 76(2), pages 611-635.

    More about this item

    Keywords

    ;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aaea26:404571. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.