Saving America from Itself: Taxing Sin
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Authors
Carey, William Dane
Issue Date
2011
Type
Thesis
Language
en_US
Keywords
Alternative Title
Abstract
Far too many people in United States suffer from a variety of preventable health
problems. Individuals are making choices that result in a host of negative outcomes. Some
negative outcomes can be categorized as externalities, but a larger portion is more correctly
categorized as internalities. Despite a growing amount of attention, internalities have not
historically been the focus of extensive research. The severity of the internality problem,
however, leaves the United States in need of a solution. My objective in this paper is to
demonstrate that sin taxes can be used as an effective public policy mechanism for correcting
internalities. To do this I will first show that the two alternative approaches used in the past have
been unsuccessful. I will go on to narrate the limited use of sin taxes at the federal and state
level, and then examine the United States' application of this tax in a world perspective. My
subsequent objective will be to provide an explanation for the unusually low level of sin taxes in
the United States. Finally, I will make the case for taxing sin by describing how an internality is
a form of market failure. I will then demonstrate how taxation is able to correct this failure, and
chronicle the precedential effectiveness of sin taxes at correcting internalities and generating
government revenue. In order to further substantiate the advantages of this policy, I will address
the main concerns surrounding sin taxes and show why they are ill-founded.
Description
44 p.
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License
U.S. copyright laws protect this material. Commercial use or distribution of this material is not permitted without prior written permission of the copyright holder.