Tax incidence when individuals are time-inconsistent: the case of cigarette excise taxes

• 成果类型: Article
• 署名作者: Gruber, J; Köszegi, B
• 署名单位: Massachusetts Institute of Technology (MIT); National Bureau of Economic Research; University of California System; University of California Berkeley
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2003.06.001
• 发表日期: 2004
• 页码: 1959-1987
• 关键词: cigarettes; excise tax; self-control function

摘要

One of the most cogent criticisms of excise taxes is their regressivity, with lower income groups spending a much larger share of their income on goods such as cigarettes than do higher income groups. We argue that traditional quantity-based measures of incidence are only appropriate under a very restrictive time-consistent model of consumption of sin goods. A model that is much more consistent with existing evidence on smoking decisions is a time-inconsistent formulation where excise taxes on cigarettes serve a self-control function that is valued by smokers who would like to quit but cannot. This self-control function benefits lower income groups more, since they have a significantly higher price sensitivity of smoking. Calibrations show that, as a result, cigarette taxes are much less regressive than previously assumed, and are even progressive for a wide variety of parameter values. (C) 2003 Elsevier B.V. All rights reserved.