Arbeitspapier

Taxes on Unhealthy Food and Externalities in the Parental Choice of Children's Diet

This paper addresses the question whether taxes on unhealthy food are suitable for internalizing intergenerational externalities inflicted by parents when they decide on their children’s diet. Within an OLG model with an imperfectly altruistic parent, the optimal steady state tax rate on unhealthy food is strictly positive. However, it is only second best since it not only reduces food consumption of the child but also distorts the parent's food consumption. Surprisingly, the optimal tax may under- or overinternalize the marginal damage.

Language
Englisch

Bibliographic citation
Series: CESifo Working Paper ; No. 7837

Classification
Wirtschaft
Consumer Economics: Theory
Externalities
Taxation and Subsidies: Efficiency; Optimal Taxation
Health Behavior
Subject
obesity
fat tax
altruism

Event
Geistige Schöpfung
(who)
Kalamov, Zarko
Runkel, Marco
Event
Veröffentlichung
(who)
Center for Economic Studies and ifo Institute (CESifo)
(where)
Munich
(when)
2019

Handle
Last update
10.03.2025, 11:41 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Kalamov, Zarko
  • Runkel, Marco
  • Center for Economic Studies and ifo Institute (CESifo)

Time of origin

  • 2019

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