Modelling the health impact of food taxes and subsidies with price elasticities: The case for additional scaling of food consumption using the total food expenditure elasticity.

ABSTRACT:

Background

Food taxes and subsidies are one intervention to address poor diets. Price elasticity (PE) matrices are commonly used to model the change in food purchasing. Usually a PE matrix is generated in one setting then applied to another setting with differing starting consumptions and prices of foods. This violates econometric assumptions resulting in likely mis-estimation of total food consumption. In this paper we demonstrate this problem, canvass possible options for rescaling all consumption after applying a PE matrix, and illustrate the use of a total food expenditure elasticity (TFEe; the expenditure elasticity for all food combined given the policy-induced change in the total price of food). We use case studies of: NZ$2 per 100g saturated fat (SAFA) tax, NZ$0.4 per 100g

SUBMITTER: Blakely T 

PROVIDER: S-EPMC7098589 | biostudies-literature | 2020

REPOSITORIES: biostudies-literature