The Impact of the Philadelphia Beverage Tax on Purchases and Consumption by Adults and Children

50 Pages Posted: 17 Sep 2018

See all articles by John Cawley

John Cawley

Cornell University - College of Human Ecology, Department of Policy Analysis & Management (PAM); Cornell University - College of Arts & Sciences, Department of Economics; The University of Sydney - School of Economics; National University of Ireland, Galway (NUIG) - J.E. Cairnes School of Business & Economics; NBER; IZA

David E. Frisvold

University of Iowa - Henry B. Tippie College of Business - Department of Economics

Anna Hill

Mathematica Policy Research

David Jones

Mathematica Policy Research, Inc.

Multiple version iconThere are 2 versions of this paper

Date Written: September 2018

Abstract

In recent years, numerous U.S. cities have enacted taxes on sweetened beverages, but there is relatively little evidence about the effects of these taxes on purchases and consumption. In this paper, we examine the effects of the beverage tax of 1.5 cents per ounce that was implemented in Philadelphia starting January 1, 2017. We surveyed individuals in Philadelphia and nearby comparison communities before the tax and nearly one year after implementation of the tax about their purchases and consumption of beverages. We find that purchases of taxed beverages fell by 8.9 ounces per shopping trip in Philadelphia stores relative to comparison stores outside of the city and that Philadelphia residents increased purchases of taxed beverages outside of the city. The tax reduced adults’ frequency of regular soda consumption by 10.4 times per month, and there is some evidence of a slight reduction in adults’ overall sugar consumption from sweetened beverages, with larger reductions for African-American adults. The tax did not have a substantial effect on the frequency of adults’ consumption of other beverages. We generally do not find detectable effects of the tax on children’s consumption of beverages, although we find a substantial reduction in consumption of added sugars from sweetened beverages among children who had high pre-tax consumption levels.

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Suggested Citation

Cawley, John and Frisvold, David E. and Hill, Anna and Jones, David, The Impact of the Philadelphia Beverage Tax on Purchases and Consumption by Adults and Children (September 2018). NBER Working Paper No. w25052. Available at SSRN: https://ssrn.com/abstract=3250598

John Cawley (Contact Author)

Cornell University - College of Human Ecology, Department of Policy Analysis & Management (PAM) ( email )

3M24 MVR Hall
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Cornell University - College of Arts & Sciences, Department of Economics ( email )

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The University of Sydney - School of Economics ( email )

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National University of Ireland, Galway (NUIG) - J.E. Cairnes School of Business & Economics ( email )

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NBER

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IZA ( email )

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David E. Frisvold

University of Iowa - Henry B. Tippie College of Business - Department of Economics ( email )

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319-335-0957 (Phone)

HOME PAGE: http://www.biz.uiowa.edu/frisvold/

Anna Hill

Mathematica Policy Research ( email )

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Suite 800
Cambridge, MA 02139
United States

David Jones

Mathematica Policy Research, Inc. ( email )

955 Massachusetts Ave
Suite 801
Cambridge, MA 02139
United States
617-674-8351 (Phone)

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