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Framing and signalling effects of taxes on sugary drinks: a discrete choice experiment among households in Great Britain

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  • Cornelsen, Laura
  • Quaife, Matthew
  • Lagarde, Mylene
  • Smith, Richard D.

Abstract

Taxes on sugar-sweetened beverages (SSBs) are in place in many countries to combat obesity with emerging evidence that these are effective in reducing purchases of SSBs. In this study, we tested whether signalling and framing the price increase from an SSB tax explicitly as a health-related, earmarked measure reduces the demand for SSBs more than an equivalent price increase. We measured the demand for non-alcoholic beverages with a discrete choice experiment (DCE) administered online to a randomly selected group of n = 603 households with children in Great Britain (GB) who regularly purchase SSBs. We find a suggestive evidence that a price increase leads to a larger reduction in the probability of choosing SSBs when it is signalled as a tax and framed as a health-related and earmarked policy. Respondents who did not support a tax on SSBs, who were also more likely to choose SSBs in the first place, were on average more responsive to a price increase framed as an earmarked tax than those who supported the tax. The predictive validity of the DCE, to capture preferences for beverages, was confirmed using actual purchase data. The findings imply that a well-signalled and earmarked tax on SSBs could improve its effectiveness at reducing the demand.

Suggested Citation

  • Cornelsen, Laura & Quaife, Matthew & Lagarde, Mylene & Smith, Richard D., 2020. "Framing and signalling effects of taxes on sugary drinks: a discrete choice experiment among households in Great Britain," LSE Research Online Documents on Economics 105777, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:105777
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    File URL: http://eprints.lse.ac.uk/105777/
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    Cited by:

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    3. Samare P. I. Huls & Emily Lancsar & Bas Donkers & Jemimah Ride, 2022. "Two for the price of one: If moving beyond traditional single‐best discrete choice experiments, should we use best‐worst, best‐best or ranking for preference elicitation?," Health Economics, John Wiley & Sons, Ltd., vol. 31(12), pages 2630-2647, December.

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    More about this item

    Keywords

    demand analysis; discrete choice experiment; framing and signalling; sugar-sweetened beverage tax; United Kingdom;
    All these keywords.

    JEL classification:

    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook

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