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Meat the Future - A Cost-Benefit Analysis of a Pigouvian Tax on Meat in Sweden

Sandsborg, Joel LU and Nilsson, Hannes LU (2016) NEKN01 20161
Department of Economics
Abstract
This thesis considers a hypothetical Pigouvian tax on meat in Sweden. The theoretical framework regards controlling for externalities and previous empirical research of excise duties on food, which end up in a Cost-Benefit Analysis (CBA) with a policy recommendation. Food production contributes up to as much as 26% of all GHG emissions and increasing meat consumption are positively correlated with the risk of colorectal cancer. This leads to a distorted market due to existing negative externalities. Imposing a tax on meat consumption in Sweden will have direct effects on both consumer and producer levels, which leads to consequences in terms of lost utility of not eating meat respectively lost revenues due to less sold meat. Nonetheless,... (More)
This thesis considers a hypothetical Pigouvian tax on meat in Sweden. The theoretical framework regards controlling for externalities and previous empirical research of excise duties on food, which end up in a Cost-Benefit Analysis (CBA) with a policy recommendation. Food production contributes up to as much as 26% of all GHG emissions and increasing meat consumption are positively correlated with the risk of colorectal cancer. This leads to a distorted market due to existing negative externalities. Imposing a tax on meat consumption in Sweden will have direct effects on both consumer and producer levels, which leads to consequences in terms of lost utility of not eating meat respectively lost revenues due to less sold meat. Nonetheless, there are also gains from an environmental perspective and reduced health care costs. Hence, the purpose is to analyse whether the accompanied costs outweigh the benefits or if a vice versa connexion prevails. The conducted CBA with succeeding empirical results suggests that a Pigouvian tax on meat cannot, under the assumptions of this thesis, come with improved net social benefits (NSB), despite lower costs from an environmental as well as from a health care cost perspective. (Less)
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author
Sandsborg, Joel LU and Nilsson, Hannes LU
supervisor
organization
course
NEKN01 20161
year
type
H1 - Master's Degree (One Year)
subject
keywords
Pigouvian tax, meat consumption and production, negative externalities, cost-benefit analysis, Sweden
language
English
id
8879511
date added to LUP
2016-06-22 14:25:35
date last changed
2016-06-22 14:25:35
@misc{8879511,
  abstract     = {This thesis considers a hypothetical Pigouvian tax on meat in Sweden. The theoretical framework regards controlling for externalities and previous empirical research of excise duties on food, which end up in a Cost-Benefit Analysis (CBA) with a policy recommendation. Food production contributes up to as much as 26% of all GHG emissions and increasing meat consumption are positively correlated with the risk of colorectal cancer. This leads to a distorted market due to existing negative externalities. Imposing a tax on meat consumption in Sweden will have direct effects on both consumer and producer levels, which leads to consequences in terms of lost utility of not eating meat respectively lost revenues due to less sold meat. Nonetheless, there are also gains from an environmental perspective and reduced health care costs. Hence, the purpose is to analyse whether the accompanied costs outweigh the benefits or if a vice versa connexion prevails. The conducted CBA with succeeding empirical results suggests that a Pigouvian tax on meat cannot, under the assumptions of this thesis, come with improved net social benefits (NSB), despite lower costs from an environmental as well as from a health care cost perspective.},
  author       = {Sandsborg, Joel and Nilsson, Hannes},
  keyword      = {Pigouvian tax,meat consumption and production,negative externalities,cost-benefit analysis,Sweden},
  language     = {eng},
  note         = {Student Paper},
  title        = {Meat the Future - A Cost-Benefit Analysis of a Pigouvian Tax on Meat in Sweden},
  year         = {2016},
}