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Abstract
Due to the growing rates of obesity and the high consumption of sugar-sweetened beverages (SSBs), several US municipalities have implemented large excise taxes on SSBs. One tenet of demand theory is the downward-sloping demand curve. As the SSB price is raised by a tax, SSB quantity demanded is expected to decline. However, there is a concern that consumers may substitute other untaxed unhealthy foods for SSBs. In this study, we investigate the potential for this unintended consequence using retail scanner data on carbonated soft drinks and salty snacks.