The effectiveness of taxes in decreasing candy purchases

Kyle A. Hoy; Douglas H. Wrenn

doi:10.1016/j.foodpol.2020.101959

The effectiveness of taxes in decreasing candy purchases

Kyle A. Hoy, Douglas H. Wrenn

Research output: Contribution to journal › Article › peer-review

1 Scopus citations

Abstract

We use candy purchase data at the household level to analyze changes in candy purchases due to Colorado's candy tax. Colorado is one of the many states that exempts candy containing flour from their candy tax. To do this, we construct a dataset of monthly household taxed and tax-exempt candy purchases for the years 2009 and 2010 for the Denver, CO and Omaha, NE metros. Difference-in-differences estimates imply that Colorado's candy tax led to a decrease in taxed candy purchases of at least 11.2%, which would translate into a reduction of household body weight of at least one pound during the first year the tax is in effect. Conversely, we find no effect on the purchase of tax-exempt candy.

Original language	English (US)
Article number	101959
Journal	Food Policy
Volume	97
DOIs	https://doi.org/10.1016/j.foodpol.2020.101959
State	Published - Dec 2020

All Science Journal Classification (ASJC) codes

Food Science
Development
Sociology and Political Science
Economics and Econometrics
Management, Monitoring, Policy and Law

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10.1016/j.foodpol.2020.101959

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@article{dcb9aa810d374e0dbf353286eb80b6c5,

title = "The effectiveness of taxes in decreasing candy purchases",

abstract = "We use candy purchase data at the household level to analyze changes in candy purchases due to Colorado's candy tax. Colorado is one of the many states that exempts candy containing flour from their candy tax. To do this, we construct a dataset of monthly household taxed and tax-exempt candy purchases for the years 2009 and 2010 for the Denver, CO and Omaha, NE metros. Difference-in-differences estimates imply that Colorado's candy tax led to a decrease in taxed candy purchases of at least 11.2%, which would translate into a reduction of household body weight of at least one pound during the first year the tax is in effect. Conversely, we find no effect on the purchase of tax-exempt candy.",

author = "Hoy, {Kyle A.} and Wrenn, {Douglas H.}",

note = "Funding Information: We thank Edward Jaenicke, Joel Landry, and two anonymous referees for helpful comments and suggestions. Researcher(s) own analyses calculated (or derived) based in part on data from The Nielsen Company (US), LLC and marketing databases provided through the Nielsen Datasets at the Kilts Center for Marketing Data Center at The University of Chicago Booth School of Business. The conclusions drawn from the Nielsen data are those of the researcher(s) and do not reflect the views of Nielsen. Nielsen is not responsible for, had no role in, and was not involved in analyzing and preparing the results reported herein. This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sector. Publisher Copyright: {\textcopyright} 2020 Elsevier Ltd Copyright: Copyright 2020 Elsevier B.V., All rights reserved.",

year = "2020",

month = dec,

doi = "10.1016/j.foodpol.2020.101959",

language = "English (US)",

volume = "97",

journal = "Food Policy",

issn = "0306-9192",

publisher = "Elsevier B.V.",

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T1 - The effectiveness of taxes in decreasing candy purchases

AU - Hoy, Kyle A.

AU - Wrenn, Douglas H.

N1 - Funding Information: We thank Edward Jaenicke, Joel Landry, and two anonymous referees for helpful comments and suggestions. Researcher(s) own analyses calculated (or derived) based in part on data from The Nielsen Company (US), LLC and marketing databases provided through the Nielsen Datasets at the Kilts Center for Marketing Data Center at The University of Chicago Booth School of Business. The conclusions drawn from the Nielsen data are those of the researcher(s) and do not reflect the views of Nielsen. Nielsen is not responsible for, had no role in, and was not involved in analyzing and preparing the results reported herein. This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sector. Publisher Copyright: © 2020 Elsevier Ltd Copyright: Copyright 2020 Elsevier B.V., All rights reserved.

PY - 2020/12

Y1 - 2020/12

N2 - We use candy purchase data at the household level to analyze changes in candy purchases due to Colorado's candy tax. Colorado is one of the many states that exempts candy containing flour from their candy tax. To do this, we construct a dataset of monthly household taxed and tax-exempt candy purchases for the years 2009 and 2010 for the Denver, CO and Omaha, NE metros. Difference-in-differences estimates imply that Colorado's candy tax led to a decrease in taxed candy purchases of at least 11.2%, which would translate into a reduction of household body weight of at least one pound during the first year the tax is in effect. Conversely, we find no effect on the purchase of tax-exempt candy.

AB - We use candy purchase data at the household level to analyze changes in candy purchases due to Colorado's candy tax. Colorado is one of the many states that exempts candy containing flour from their candy tax. To do this, we construct a dataset of monthly household taxed and tax-exempt candy purchases for the years 2009 and 2010 for the Denver, CO and Omaha, NE metros. Difference-in-differences estimates imply that Colorado's candy tax led to a decrease in taxed candy purchases of at least 11.2%, which would translate into a reduction of household body weight of at least one pound during the first year the tax is in effect. Conversely, we find no effect on the purchase of tax-exempt candy.

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JO - Food Policy

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The effectiveness of taxes in decreasing candy purchases

Abstract

All Science Journal Classification (ASJC) codes

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