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The productivity gains associated with a junk food tax and their impact on cost-effectiveness

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  • Hannah E Carter
  • Deborah J Schofield
  • Rupendra Shrestha
  • Lennert Veerman

Abstract

Objective: To estimate the productivity impacts of a policy intervention on the prevention of premature mortality due to obesity. Methods: A simulation model of the Australian population over the period from 2003 to 2030 was developed to estimate productivity gains associated with premature deaths averted due to an obesity prevention intervention that applied a 10% tax on unhealthy foods. Outcome measures were the total working years gained, and the present value of lifetime income (PVLI) gained. Impacts were modelled over the period from 2003 to 2030. Costs are reported in 2018 Australian dollars and a 3% discount rate was applied to all future benefits. Results: Premature deaths averted due to a junk food tax accounted for over 8,000 additional working years and a $307 million increase in PVLI. Deaths averted in men between the ages of 40 to 59, and deaths averted from ischaemic heart disease, were responsible for the largest gains. Conclusions: The productivity gains associated with a junk food tax are substantial, accounting for almost twice the value of the estimated savings to the health care system. The results we have presented provide evidence that the adoption of a societal perspective, when compared to a health sector perspective, provides a more comprehensive estimate of the cost-effectiveness of a junk food tax.

Suggested Citation

  • Hannah E Carter & Deborah J Schofield & Rupendra Shrestha & Lennert Veerman, 2019. "The productivity gains associated with a junk food tax and their impact on cost-effectiveness," PLOS ONE, Public Library of Science, vol. 14(7), pages 1-11, July.
    • Handle: RePEc:plo:pone00:0220209
    DOI: 10.1371/journal.pone.0220209
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    References listed on IDEAS

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    1. J Lennert Veerman & Gary Sacks & Nicole Antonopoulos & Jane Martin, 2016. "The Impact of a Tax on Sugar-Sweetened Beverages on Health and Health Care Costs: A Modelling Study," PLOS ONE, Public Library of Science, vol. 11(4), pages 1-10, April.
    2. Zhang, Wei & Bansback, Nick & Anis, Aslam H., 2011. "Measuring and valuing productivity loss due to poor health: A critical review," Social Science & Medicine, Elsevier, vol. 72(2), pages 185-192, January.
    3. Nomaguchi, Takeshi & Cunich, Michelle & Zapata-Diomedi, Belen & Veerman, J. Lennert, 2017. "The impact on productivity of a hypothetical tax on sugar-sweetened beverages," Health Policy, Elsevier, vol. 121(6), pages 715-725.
    4. Linda J Cobiac & King Tam & Lennert Veerman & Tony Blakely, 2017. "Taxes and Subsidies for Improving Diet and Population Health in Australia: A Cost-Effectiveness Modelling Study," PLOS Medicine, Public Library of Science, vol. 14(2), pages 1-18, February.
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