We developed a theoretical framework to examine the effect of a change in sales or excise tax on food and beverage demand after considering that consumers may have imperfect tax knowledge, are sometimes inattentive to sales tax, may not be informed of a sales tax change, and pay no sales tax on eligible food or beverages if using food stamps.We conducted simulations to assess how much the sales tax elasticity of demand should be adjusted downward from the price elasticity of demand and quantified the advantage of using an excise tax as an anti-obesity policy.
|Number of pages||19|
|Journal||American Journal of Agricultural Economics|
|State||Published - Apr 2013|
Bibliographical noteFunding Information:
Funding for this research was provided by Cornell University Food Industry Management Program.
- Excise tax
- Food and beverages
- Imperfect tax knowledge
- Sales tax
ASJC Scopus subject areas
- Agricultural and Biological Sciences (miscellaneous)
- Economics and Econometrics