The Vice versus Virtue of Temptation in Economies and Sin Fiscal Instruments

• Main Authors: Lai, Yi-Shiuan, 賴憶萱
• Other Authors: Chen, Bor-Ching
• Format: Others
• Language: zh-TW
• Published: 2018
• Online Access: http://ndltd.ncl.edu.tw/handle/2ftqap

碩士 === 國立高雄應用科技大學 === 財富與稅務管理系 === 106 === Everything now in the future will all become past. The individuals like short-term immediate gratification in intertemporal choice, because they are present-bias and exhibit preference reversal phenomenon. This paper employs a temptation framework. Sin goods are defined as goods that provide the current self with positive utility, but negative utility to any future self. Self-control problems make tempting choices for ourselves, and these are against our own better judgment and self-interest. The government corrects over-consumption by agents with self-control problems. This paper shows the welfare effects when the fiscal instruments of sin tax and sin license are used. By improving the behavior of the consumers with self-control problems, while lowering the overall tax burden on the consumers with full self-control, all consumers are benefit from an increase in sin taxation. The use of fat taxes and thin subsidies is as a method of regulating diets and improving health. They marry vice and virtue. The fat (or unhealthy foods) tax and thin subsidies (or healthy foods) will have a negative welfare effect in terms of regressive wealth redistribution, however such a policy will have a positive welfare effect in terms of progressive health redistribution.