A couple of weeks ago, I blogged about soda taxes, the subject of a story I had in the magazine. At the time, Time.com readers couldn’t see the story, thanks to our new (pay) wall. Well, as it turns out, we’re only hiding our magazine stories for two weeks, and then they’re going up on the web site in full form. So now, after much anticipation, you can read what I wrote here.
Since I reported that story, another notable study of soda taxes has come out, from the U.S. Department of Agriculture’s Economic Research Service. The conclusion: hiking the price of sugar-sweetened soda, juice and sports drinks by 20% could cut the percentage of adult Americans who are overweight from 66.9% to 62.4%. More specifically:
This study estimated that a tax-induced 20-percent price increase on caloric sweetened beverages could cause an average reduction of 37 calories per day, or 3.8 pounds of body weight over a year, for adults and an average of 43 calories per day, or 4.5 pounds over a year, for children. Given these reductions in calorie consumption, results show an estimated decline in adult overweight prevalence (66.9 to 62.4 percent) and obesity prevalence (33.4 to 30.4 percent), as well as the child at-risk-for-overweight prevalence (32.3 to 27.0 percent) and the overweight prevalence (16.6 to 13.7 percent). Actual impacts would depend on many factors, including how the tax is reﬂected in consumer prices and the competitive strategies of beverage manufacturers and food retailers.
One nice thing that this study does, which such studies don’t always do, is take into account what people will drink more of as they drink less sugar-sweetened soda. The USDA’s researchers used data from Nielsen Homescan panelists between 1998 and 2007, giving them insight into everything people bought at the grocery store. One conclusion: as the price of soda goes up, people are most likely to switch to bottled water. After water, they also drink more fruit and vegetable juice, and after juice, more milk. Interestingly, when the price of sugar-sweetened soda goes up, people also buy less diet soda. The researchers write, “the complimentary effect is possibly the result of a diverse set of preferences within a household for diet and nondiet sweetened beverages.”
Now, there is a downside to the approach used. Researchers only looked at grocery store purchases, and about half of the caloric sweetened beverages we drink, we drink away from home. At a fast food restaurant, the price of soda is often bundled with the price of a hamburger and fries. It is perfectly reasonable to believe that an increase in soda prices in such an environment would drive behavior differently.
Nonetheless, the researchers make one interesting point that holds no matter where people get their calories from: a large number of Americans are overweight or obese by just a few pounds. Even a small reduction in caloric intake—such as the one caused by driving up the price of soda—could change the weight classification for many people.
You can read the full study here (PDF). It includes some great charts and tables, including this one which shows where the added sugar in our diet tends to come from (click on the image to make it larger):