Mean and variance measures of health information about cholesterol and saturated fat are included in a demand system for fats and oils. A Bayesian model of health risk belief and consumer awareness surveys are the basis for computing these measures. The empirical demand model shows that health information has resulted in significant increases in consumption for corn, cottonseed, and soybean oils and decreased consumption for butter and lard. The predicted demand effects based on the Bayesian information model are more reasonable than predictions from using either a time trend or a simple cumulative cholesterol information index.

This paper documents the interstate variation in capital gains taxation and examines the relation between the marginal tax rate on capital gains and aggregated state-level realizations between 1979 and 1990. Using state-level aggregated data, rather than data on individual taxpayers, alleviates the problem that the marginal tax rate is endogenous to the amount of capital gains realized. The estimated elasticity of realizations with respect to the tax rate is -0.65, smaller than that found by most researchers using panel data. This finding is robust to a variety of alternative specifications.