Publications
The Pass-Through of the Largest Tax on Sugar-Sweetened Beverages: The Case of Boulder, Colorado
(with John Cawley, David Frisvold, and David Jones)
This paper estimates the pass-through of the largest tax on sugar-sweetened beverages enacted in the U.S., which is two cents per ounce in Boulder, Colorado. A strength of the paper is that, to achieve as complete a perspective as possible, we estimate the pass-through of the tax not only to beverage prices in retail stores but also to those in restaurants, and we examine data for the treatment community of Boulder and a comparison community of Fort Collins, Colorado, from four sources: (a) hand-collected data on prices from stores; (b) Nielsen Retail Scanner Data of store prices; (c) hand-collected data on prices in restaurants; and (d) web-scraped data from online restaurant menus. Across the multiple datasets, we find consistent evidence that the tax was largely, but not completely, passed through to consumers. In both the hand-collected store data and restaurant data, pass-through is slightly less than 75%, whereas pass-through is just over 50% using the scanner data; consumers bear most, but not all, of the largest tax on sugar-sweetened beverages in the United States.
American Journal of Agricultural Economics, Volume 103, Issue 3, May 2021
Economics of Obesity
(with David Frisvold)
This chapter provides an overview of the levels, trends, causes, and consequences of obesity, related market failures, and the evidence of the impact of policies that could potentially address the market failures. More than 40% of adults in the United States are obese, and obesity-related healthcare accounts for over 20% of total annual medical expenditures. The decrease in the price of calorie-dense foods, which led to an increase in average calories consumed, is a primary cause of the rise in obesity since the 1970s. There are also significant market failures associated with obesity, including negative externalities due to pooled health insurance and asymmetric information between food producers and consumers. The presence of market failures provides support for government policies aimed at decreasing and preventing obesity. Public policy tactics to address this issue include price-based, information-based, and school-based policies. Of these, school-based policies may be the most effective as they help form healthy nutrition habits and prevent obesity in adulthood when healthcare costs are much higher. Overall, obesity rates remain high and continued government intervention is necessary to improve the market failures related to this epidemic.
Handbook of Labor, Human Resources and Population Economics, 2021
Working Papers
Cup of Joe and Knowledge Flow: Coffee Shops and Invention (with Michael Andrews)
We estimate how the availability of informal gathering places can facilitate knowledge spillovers that lead to innovation. More specifically, we estimate how the spread of coffee shops increases local inventive activity. To account for endogeneity in the number of coffee shops in an area, we use an instrumental variables approach based on the geographic and temporal patterns of the opening of Starbucks coffee establishments.As Starbucks opened new establishments, these establishments tended to spread out-ward from the location of the first Starbucks establishments in Seattle. Using thisstrategy, we find that 10% faster growth in the number of new Starbucks stores in acounty increases patent filings in that county by about 4-6%. A faster growth rateof Starbucks increases citations to local patents, suggesting that increasing localized knowledge flow shifts the direction of invention towards local ideas. Collaborative patenting and patenting by firms both increase, and does collaboration across firms, providing suggestive evidence that coffee shops are especially conducive for cross-firm business meetings
Price and Quality Responses of the Restaurant Industry to Increases in the Minimum Wage [pdf]
Using a novel dataset comprised of online menu item and restaurant quality information from thousands of primarily non-chain establishments across three states, I estimate the price and quality responses to varying levels of minimum wage increases enacted at the start of 2017. I find that prices rise 0.3% to 0.8% in response to a 10% increase in the minimum wage. These results are consistent with previous estimates in the literature, as well as what is predicted by the textbook model of competitive factor markets and monopolistically competitive firms. Building on this, I then extend the literature to more broadly understand the price pass-through as well as provide the first estimates of responses on quality. I find heterogeneity in pass through across restaurant characteristics, with higher pass-through among small firms, and lower pass-through for restaurants near the border of a minimum wage policy region. At the menu item level, pass-through is higher for sides and sandwiches, and options with organic or gluten-free ingredients. I find no evidence of higher pass-through for popular items. Finally, I find significant changes in restaurant quality due to an increase in the minimum wage. Specifically, I find that for low quality restaurants, quality decreases after an increase in the minimum wage, but that quality increases for high quality restaurants.
Works In Progress
Program Evaluation of a Supplemental Education Program: Kids on Course (with Drew Westberg)
Labor Market Effects of a Health Shock on the Aging Population: Evidence from Trans Fat Bans
The Impact of School Year Calendar Structure on Childhood Weight Gain