Back to the centralized and authoritarian drawing board

The Mandarin Class are so eager to impose their will on fellow citizens as to be unseemly.  Trying to make their efforts to control the choices of others less obvious, they undertake all sorts of subterfuges.  They love the idea of nudging people, i.e. casting choices in a way that subtly disposes citizens to one choice over another has always been popular.  

Another mechanism is to impose their will via legislation and/or taxation.  In the tax arena, this often takes the form of sin taxes.  Taxes which are intended to suppress some form of societal choices which lead to societal problems.  Examples typically include taxes on tobacco (in order to suppress the choice of smoking), alcohol (in order to suppress the choice of drinking), etc.  

There is a logic to the process and the goal is well intended but it violates the assumption that everyone has equal rights and the respect of others making choices which might not otherwise be in line with the choices favored by the Mandarin Class.

While the logic and intentions might be good, the outcomes rarely are.  Central decision makers are notorious for the low quality and bad outcomes of their decisions.  More than that there is the anti-democratic position and the disrespect of citizens as autonomous decision-makers.  

In return for these centralized and authoritarian approaches to community decision-making, what are the benefits? 

What is the empirical evidence that sin taxes work?  From a new paper, How do consumers respond to “sin taxes”? New evidence from a tax on sugary drinks Eleonora Fichera, Toni Mora, Beatriz G. Lopez-Valcarcel, and David Roche.  From the Abstract:

It is unclear what the effects of taxes on sugar sweetened beverages (SSBs) are on consumer behaviour and which consumers may be affected the most. We evaluate the effect of the SSB tax introduced in Catalonia (but not in the rest of Spain) in May 2017 using loyalty card data of monthly purchases by 884,843 households from May 2016 to April 2018. Using a Difference-in-Differences approach, we study the SSB tax effect on the purchased quantity of beverages and sugar. Our results suggest a reduction in purchases of taxed beverages and a small increase in purchases of untaxed beverages. Households have substituted taxed beverages with their lower sugar (untaxed) counterparts. This has led to a 2.2% overall reduction in sugar purchases from beverages. Our study implies that although sin taxes moderately change consumer behaviour, a combination of different policies would be required to tackle obesity.

Centralized and authoritarian decision-makers wish to reduce obesity in the population by making it more expensive for citizens to consumer sugar.  The Mandarin Class do this by imposing sin-taxes, in this case increasing taxes on sugar.  In theory, and ideally, this would lead to a material reduction in sugar consumption which in turn would lead to a decline in obesity.

In this instance, as interesting as the research is, the outcomes are ambiguous.  

They are focusing on sugar beverages instead of the gamut of sugar consumption.  Given that there is a natural hunger for sweetness and that this hunger can be sated by other sources of sugar, natural and processed, introducing a policy affecting only one source of sugar may simply be displaced into consumption from other sources.

Here, there was a 2.2% reduction in sugar consumption.  Not knowing whether this was displaced by increased sugar consumption in other food categories, we have no way of telling whether there was an overall decrease in sugar consumption nor, most pertinently, whether there was an overall decrease in obesity.

Back to the centralized and authoritarian drawing board.