Thursday, October 20, 2011

Perspectives on Soda Taxation

An interesting issue of Choices magazine came out on the subject of soda taxes. Choices is a very user-friendly publication of the Agricultural and Applied Economics Association. An introduction to the special issue is located here. The first article, written by public health professionals, is cautiously supportive of an increased tax, though they note that taxing soda may encourage shifts to other types of high calorie beverages. The next, written by some health economists, looks to the parallel with tobacco taxes for inspiration. The third article, written by a public health specialist, notes that effects on obesity are likely to be small, again in part because of substitution effects. The fourth article takes aim at the substitution effects, arguing that they are not likely to cut effectiveness of the tax, which should still generate a lot of tax revenue and cut calories consumed. A fifth (by an agricultural economist) looks at the large role advertising plays in soda consumption, and the last is written by an industry advocate, arguing that the problem is one of personal choice and responsibility, and that it's wrong to use taxes to push people one direction or another.

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