WHEN DO FAT TAXES INCREASE CONSUMER WELFARE?

Previous analyses of fat taxes have generally worked within an empirical framework in which it is difficult to determine whether consumers benefit from the policy. This note outlines on simple means to determine whether consumers benefit from a fat tax by comparing the ratio of expenditures on the taxed good to the weight effect of the tax against the individual's willingness to pay for a one‐pound weight reduction. Our empirical calculations suggest that an individual would have to be willing to pay about $1500 to reduce weight by one pound for a tax on sugary beverages to be welfare enhancing. The results suggest either that a soda tax is very unlikely to increase individual consumer welfare or that the policy must be justified on some other grounds that abandon standard rationality assumptions. Copyright © 2011 John Wiley & Sons, Ltd.     

CHANGES IN CONSUMER CONCERNS REGARDING FOOD SAFETY AND TRUST IN NUTRITION EXPERTS’ ADVICE

There has been an increasing emphasis on health risk in the public debate about food, and consumers are constantly exposed to conflicting sources of information about food safety and healthy diets. This may create uncertainty among consumers and affect food choice. This study aims to evaluate change in consumers’ perception of food safety and in trust in nutrition experts’ advice, as well as consumer awareness of health issues regarding food and the degree to which they take health into consideration when choosing food for their everyday meals. This report is based on two cross-sectional, interviewer-administered surveys of nationally representative samples of the Norwegian population over 15 years of age, conducted in 1994 (n=1048) and 1999 (n=999). The data were analyzed with the use of factor analysis, t-tests, ANOVA, and logistic regression. Consumers’ uncertainty about food safety increased and trust in expert advice declined. Fewer consumers considered fat-rich foods to be a part of a healthy diet in1999 and fewer reported having health considerations in mind when making everyday food choices. Uncertainty was unrelated to consumer food choice, whereas trust had implications for the degree to which consumers chose what they believed to be a healthy diet. In conclusion, the results have shown that the decline in trust in expert advice may have important implications as to whether or not consumers use their nutritional knowledge in the choice of foods for their everyday meals.