Should employers ban soda?

A paper by Basu et al. (2020) argue that banning soda sales would be cost effective for employers. Employers largely bear the cost of adverse health impacts of sugar-sweetened beverages (SSB, aka soda); they also may lose revenue if drinks that are sold on site (e.g., at their cafeteria) decrease. The researchers create a simulation model based on a recent employer intervention. Specifically:

We used survey data from a large, multisite health care organization in California, sampling 2,276 employees three months before and twelve months after a workplace SSB sales ban was imposed. We incorporated the survey data into a simulation model to estimate chronic disease incidence and costs. We estimated that an SSB ban as effective as the one observed would save about $300,000 per 10,000 people over ten years among similar employers, as a result of averted health care and productivity spending— after both SSB sales losses and non-SSB beverage sales gains were accounted for

One key omission from the model: consumers. Consumers may actually like to drink soda. While there may be a rationale for taxing soda, failing to account for consumer disutility from reducing their choice set is problematic. Further, although few workers would quit over an SSB ban, employees may be less likely to seek out employers that act as a ‘nanny state’ on their behavior.

To be clear, I am not an advocate for soda and rarely drink any myself. Employers may have the right to ban soda sales as long they allow employees to bring soda to work. From a research perspective, however, failing to take into account consumer preferences when evaluating an intervention that restricts consumer choice, I believe, is a problematic exercise.

Source:

• Sanjay Basu, Laurie M. Jacobs, Elissa Epel, Dean Schillinger, and Laura Schmidt. Cost-Effectiveness Of A Workplace Ban On Sugar-Sweetened Beverage Sales: A Microsimulation Model. HEALTH AFFAIRS 39, NO. 7 (2020): 1140–1148.