With a national debate taking shape about the possibility of a national tax on foods with high sweetener content, ISU economists have examined how such a tax would best be applied.
Rather than assessing a tax on these sugary goods as they are taken through the grocery store checkout lines, the research shows that a better way is to tax the food processers on the amount of caloric sweeteners, such as corn syrup and sugar added in processing before the product hits the shelves.
The economists, John Beghin and Helen Jensen, both professors in the Department of Economics, are quick to point out that they are not advocating for or against any tax, but simply researching how and where a possible sweetener tax would be most effective.
"We are not saying. 'To resolve obesity, here is what you should do,'" said Beghin. "In that sense, we are not advocating anything. We are saying, 'Given that you are considering a panoply of tax instruments, and there is a possibility of a soda tax, is there a better way to use that idea?'"
"This is motivated," added Jensen, "by a lot of ideas out there that say we could tax sweetened products. We wanted to see what the effect of such a tax would be and, alternatively, if you imposed a tax on ingredients, what would be the effect of that."
The research, published in the journal Contemporary Economic Policy, shows that if the goal of a sin tax on sweeteners is to reduce calories consumed, lawmakers should consider taxing the inputs instead of the final product.
Assessing the tax at the processing stage allows food processors to reduce the amount of sweeteners they put into their products. Processors will also have incentives to use more of the lesser-taxed artificial sweeteners, and less of the higher-taxed sweeteners that are heavy in sugary products.
These solutions would also raise the price at the store less than a direct tax on the end product, while reducing the calories attributable to the sweetener, according to the study.
"Taxing the processing ingredients makes more sense when compared with taxing the end product," said Beghin. "You can abate the same number of calories without having consumers face such high prices."
Any new tax on sweeteners, even the tax on food inputs proposed by the study, will cause prices to go up. One drawback of any tax on sweetened goods is the regressive nature of that tax.
In economic terms, regressive taxes are those that impact poorer economic groups more than higher ones.
"Since much of these (sweeter) goods are consumed by poorer economic groups," said Beghin, "you may be increasing the cost of calories for poor people."
The study looks only at calories in food. The research does not make any claims about lowering obesity.
The United States' obesity rate has many factors, and the amount of calories consumed is only one, say the economists.
"We are not looking at health aspects," said Jensen. "Just the consumption of calories from sweetened goods and the disruption to the consumer."
The findings of the study fit generally accepted economic principles that say if you want to change a given behavior or economic decision, you should try to find a policy instrument that is closest to the behavior or decision, according to Beghin.
As part of the study, the two collected data from both government and private sources on industrial food inputs.
"We spent quite a bit of time assembling a data set based on published data on what inputs the food industry uses," said Jensen. "So we know that for all the different food sectors, how much sugar and corn syrup go into that industry group's food processing. You'd be amazed to see how much sweetener goes into food processing."
Disclosure: Beghin has been a consultant on sugar matters for the U.S. Government Accountability Office (2001), the Sweetener Users Association (2011), the American Enterprise Institute (2007), and the American Farm Bureau Federation (2004-5).
Dan Kuester | EurekAlert!
Microtechnology industry is hiring – positive developments of past years continue
09.04.2018 | IVAM Fachverband für Mikrotechnik
RWI/ISL-Container Throughput Index with minor decline on a high overall level
20.03.2018 | RWI – Leibniz-Institut für Wirtschaftsforschung
For the first time ever, scientists have determined the cosmic origin of highest-energy neutrinos. A research group led by IceCube scientist Elisa Resconi, spokesperson of the Collaborative Research Center SFB1258 at the Technical University of Munich (TUM), provides an important piece of evidence that the particles detected by the IceCube neutrino telescope at the South Pole originate from a galaxy four billion light-years away from Earth.
To rule out other origins with certainty, the team led by neutrino physicist Elisa Resconi from the Technical University of Munich and multi-wavelength...
For the first time a team of researchers have discovered two different phases of magnetic skyrmions in a single material. Physicists of the Technical Universities of Munich and Dresden and the University of Cologne can now better study and understand the properties of these magnetic structures, which are important for both basic research and applications.
Whirlpools are an everyday experience in a bath tub: When the water is drained a circular vortex is formed. Typically, such whirls are rather stable. Similar...
Physicists working with Roland Wester at the University of Innsbruck have investigated if and how chemical reactions can be influenced by targeted vibrational excitation of the reactants. They were able to demonstrate that excitation with a laser beam does not affect the efficiency of a chemical exchange reaction and that the excited molecular group acts only as a spectator in the reaction.
A frequently used reaction in organic chemistry is nucleophilic substitution. It plays, for example, an important role in in the synthesis of new chemical...
Optical spectroscopy allows investigating the energy structure and dynamic properties of complex quantum systems. Researchers from the University of Würzburg present two new approaches of coherent two-dimensional spectroscopy.
"Put an excitation into the system and observe how it evolves." According to physicist Professor Tobias Brixner, this is the credo of optical spectroscopy....
Ultra-short, high-intensity X-ray flashes open the door to the foundations of chemical reactions. Free-electron lasers generate these kinds of pulses, but there is a catch: the pulses vary in duration and energy. An international research team has now presented a solution: Using a ring of 16 detectors and a circularly polarized laser beam, they can determine both factors with attosecond accuracy.
Free-electron lasers (FELs) generate extremely short and intense X-ray flashes. Researchers can use these flashes to resolve structures with diameters on the...
13.07.2018 | Event News
12.07.2018 | Event News
03.07.2018 | Event News
17.07.2018 | Information Technology
17.07.2018 | Materials Sciences
17.07.2018 | Power and Electrical Engineering