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Eric Finklestein, an economist at Duke University, has argued that the external costs from being obese are larger than the external costs from smoking because "the mortality effect for obesity is much smaller than it is for smoking and the costs start much earlier in life."
a. What does Finklestein mean by the "mortality effect"? Why would the mortality effect of obesity being smaller than the mortality effect of smoking result in obesity having a larger external cost?
b. Tobacco taxes have been more politically popular than taxes on soda. Why might the general public be more willing to support cigarette taxes than soda taxes?
Source: David Leonhardt, "Obama Likes Some Sin Taxes More Than Others," New York Times, April 10, 2013.
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