Optimal tax rules and addictive consumption

Bossi, Luca; Calcott, Paul; Petkov, V.

doi:10.1016/j.jedc.2013.01.009

Cited by 1 publication

(2 citation statements)

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“…The existing literature on policies to counteract such internalities emphasizes corrective taxes, often referred to as “sin taxes.” Optimal rates for sin taxes have been characterized for a range of products including junk food (Griffith et al, 2018; O'Donoghue & Rabin, 2006), cigarettes (Bossi et al, 2013; Gruber & Köszegi, 2001), and soft drinks (Allcott et al, 2019; Grummon et al, 2019; O'Connell & Smith, 2019). These papers do not consider regulated standards.…”

Section: Introductionmentioning

confidence: 99%

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Regulating ingredients in sin goods

Calcott

2021

American J Agri Economics

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If consumption of unhealthy food is excessive, then a policymaker might respond with a corrective tax. However, she might supplement the tax with a regulatory standard that limits the concentration of an unhealthy ingredient. A tax can restore social efficiency without supplemental regulation if all of four of the following conditions are satisfied: The tax is nutrient specific, the market structure is perfect competition, the magnitude of the distortion is the same across all consumers, and consumers do not react to the tax by substituting to untaxed foods that also have unhealthy ingredients. But if any of these conditions are not met, then there can be benefits to supplementing a corrective tax with a standard.

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Section: Introductionmentioning

confidence: 99%

“…They consider a setting with product differentiation and vertical supply relationships. Bossi et al (2013) characterize the optimal tax rate on cigarettes, given that they are provided in a dynamic Cournot oligopoly. O' Connell and Smith (2019) examine the optimal tax on sugar sweetened beverages when they are produced in a differentiated Bertrand oligopoly.…”

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confidence: 99%

Regulating ingredients in sin goods

Calcott

2021

American J Agri Economics

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Optimal tax rules and addictive consumption

Cited by 1 publication

References 23 publications

Regulating ingredients in sin goods

Regulating ingredients in sin goods

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