Articles
Sugar levy had no lasting negative impacts on the UK soft drinks industry - Feb 2020.
An analysis of stock market returns of soft-drinks companies registered on the London Stock Exchange, was conducted by researchers funded by the National Institute for Health Research (NIHR), the nation’s largest funder of health and social care research, and is published today in ‘Economics & Human Biology’.
The research found that, although companies studied in the research experienced negative stock market returns on the day the tax was announced, these companies’ returns had ‘bounced back’ over the following four days. They also noted that the soft drinks companies’ stock prices increased over the following two years to the end of the study.
Professor Richard Smith, who co-authored the study, said: “Stock market values are a great barometer of how concerned investors are about announcements like the SDIL. Given the rhetoric that SDIL could have a very negative impact on industry profits it is really valuable to establish that investors didn’t see it this way, and rather that they have great confidence in the industry being able to respond and maintain their value.” He added that “this sort of finding contributes a new angle to the rapidly emerging evidence around the value of fiscal policies in improving public health nutrition.”
Date: 17 February 2020