Ketan Patel, a fourth-year doctoral student in economics, recently presented his paper "The Effectiveness of Food Taxes at Affecting Consumption in the Obese: Evaluating Soda Taxes" at a US Department of Agriculture conference on food policy in Washington, D.C. He told FoodNavigator-USA that he had originally been interested in whether obese people were less price sensitive than those of normal weight – but the data suggesting greater preference for diet soda came as a surprise.
“I did find that obese consumers are less price sensitive, but that is completely overshadowed by their preference for diet soda,” he said.
Patel said he used a combination of store-level sales data from market research organization Nielsen, which provided information on location and sales of soft drinks and their relation to price, alongside 2002 to 2006 data from the CDC’s Behavioral Risk Factor Surveillance System (BRFSS). The CDC data included information on height, weight, income and diabetes status across 230 counties, representing 40 to 50 percent of the US adult population.
This data allowed Patel to estimate consumer preferences while allowing for ‘substantial diversity’ in those preferences. He then simulated how a tax would affect choices and used those results to estimate weight change, using an existing weight change model.
"After doing the analysis, it really turns out to be the case that obese people like diet soda so much more than regular soda that you can do whatever you want to the price," he said. "You're not going to get that much change in obese people's weight because they already drink diet soda."
Patel said he was prompted to conduct the research after finding little research into whether obese people will respond to soda tax with changes in behavior. However, he acknowledged that a tax on sugary drinks could play a role in preventing obesity in normal weight or overweight people if they are gradually gaining weight over time.
“More research needs to be done on this aspect, however,” Patel said.
The idea of a soda tax has been repeatedly raised as a possible way to combat obesity while raising tax revenue. Meanwhile, its opponents say that the beverage industry is being unfairly targeted – and some, like Patel, question whether it would be an effective tool for tackling obesity anyway.
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