Income Elasticity of Demand for Tanning Bed Usage: Evidence from Survey Data

Tuesday, June 25, 2019
Exhibit Hall C (Marriott Wardman Park Hotel)

Presenter: Neil Meredith

Using data on U.S. adults from the National Health Interview Series, we estimate the income elasticity of demand for tanning bed usage among users and evaluate the factors that influence non-use of tanning beds. While controlling for individual characteristics, estimates show that the income elasticity of demand indicates that tanning bed usage is a normal service that is viewed as a necessity for users. For non-users, estimates reveal, after controlling for individual characteristics, that income is negatively associated with the probability of becoming a tanning bed user. Results suggest that usage of tanning beds grows for users as income increases and makes tanning usage more affordable. The findings imply that policymakers may need to increase the 10% usage tax placed on tanning beds as part of the Patient Protection and Affordable Care Act to reduce usage among continuing users.