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Understanding price elasticities to inform public health research and intervention studies: key issues
Nhung Nghiem1, Nick Wilson, Murat Genç
1Nhung Nghiem, Nick Wilson, and Tony Blakely are with the Department of Public Health, University of Otago, Wellington, New Zealand. Murat Genç is with the Department of Economics, University of Otago, Dunedin, New Zealand.
Abstract:
Pricing policies such as taxes and subsidies are important tools in preventing and controlling a range of threats to public health. This is particularly so in tobacco and alcohol control efforts and efforts to change dietary patterns and physical activity levels as a means of addressing increases in noncommunicable diseases. To understand the potential impact of pricing policies, it is critical to understand the nature of price elasticities for consumer products. For example, price elasticities are key parameters in models of any food tax or subsidy that aims to quantify health impacts and cost-effectiveness. We detail relevant terms and discuss key issues surrounding price elasticities to inform public health research and intervention studies.
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