Taxing Sin Goods and Subsidizing Health Care
We study the taxation of sin goods in a two-period, three-good model. Individuals can buy health care to compensate for the damages caused by their earlier sin-good consumption. Individuals are myopic and underestimate the effect of the sinful consumption on health; in their second period, they may...
- Autores:
- Tipo de recurso:
- Fecha de publicación:
- 2012
- Institución:
- Universidad del Rosario
- Repositorio:
- Repositorio EdocUR - U. Rosario
- Idioma:
- eng
- OAI Identifier:
- oai:repository.urosario.edu.co:10336/23266
- Acceso en línea:
- https://doi.org/10.1111/j.1467-9442.2011.01666.x
https://repository.urosario.edu.co/handle/10336/23266
- Palabra clave:
- Behavioral response
Consumption behavior
Health care
Model test
Paternal effect
Subsidy system
Tax system
Behavioral economics
Dual self versus single self
Paternalism
- Rights
- License
- Abierto (Texto Completo)
| Summary: | We study the taxation of sin goods in a two-period, three-good model. Individuals can buy health care to compensate for the damages caused by their earlier sin-good consumption. Individuals are myopic and underestimate the effect of the sinful consumption on health; in their second period, they may acknowledge their mistake or persist in their error. We characterize and compare the first-best and the (linear) second-best taxes in these different settings. In particular, we examine how the results are affected by the way sin-good consumption and health care interact in health production technology. © 2011 The editors of The Scandinavian Journal of Economics. |
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