Universidad Adolfo Ibañez

Expenditures on sugar‑sweetened beverages in Jamaica and its association with household budget allocation

Área de publicación Economía
Tipo de publicación Artículos
Fecha de publicación 2022
Autores Guillermo Paraje - Fabio S. Gomes

Background: Sugar-sweetened beverages (SSB) consumption is associated with overweight and obesity, which are important drivers for the increasing healthcare and other social costs. If expenditures on SSB decrease expenditures on other goods and services, such as education and healthcare, this “crowding-out” may have a lasting effect. The main objectives of this article are, first, to estimate the statistical association between the decision of spending in SSB and several households’ sociodemographic characteristics; and second, to estimate the association between the decision of buying SSB and budget allocation across categories in Jamaica.

Methods: Using the Jamaican Household Expenditure Survey 2004–2005 a generalized ordered probit model was estimated to examine the association between socioeconomic variables and the decision to spend on SSB. Seemingly Unrelated Regression Equations (SURE) of all the expenditure groups (except the SSB group) were used to estimate the association between the decision of buying SSB and budget allocation on other goods and services.

Results: Expenditures on SSB are negatively affected by the size of the household and the area of residence (rural households spend more on SSB than urban ones), while having a larger proportion of children (15 or younger) and having a larger total budget is associated to more expenditures on SSB. Households with positive expenditure on SSB allocate significantly less budget to “Healthcare” and “Education”, when compared to those who did not buy SSB.

Conclusions: SSB expenditures may displace expenditures in necessary goods and services, which implies that decreasing the proportion of budget spent on SSB may have important present and future consequences on poorer households’ human capital accumulation and future incomes.

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